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President Trump signed an executive order on Thursday to create a national stockpile of Bitcoin and other digital currencies, an audacious idea that has been widely criticized as a scheme to enrich crypto investors.
The basis of the stockpile will be a stash of Bitcoin, estimated to be worth as much as $17 billion, that the United States has seized in legal cases over the years.
The order also calls for federal agencies to develop strategies to buy more Bitcoin, the most popular digital currency, as long as those purchases do not generate extra costs for taxpayers.
“This Executive Order underscores President Trump’s commitment to making the U.S. the ‘crypto capital of the world,’” said David Sacks, the White House’s crypto and A.I. policy czar, in a post on social media. He said the United States would not sell any Bitcoin in the reserve, which he likened to “a digital Fort Knox.”
Since Mr. Trump took office in January, his administration has moved rapidly to elevate the crypto industry, a volatile sector that had battled with federal regulators for years. The Securities and Exchange Commission has dropped lawsuits against two of the biggest U.S. crypto companies and halted investigations into several others. And on Friday, Mr. Trump is scheduled to host crypto executives at the White House for a first-of-its-kind “crypto summit.”
Mr. Trump has a personal stake in the success of the crypto industry, creating conflicts of interests that have raised alarms with government ethics experts. Last year he started a business, World Liberty Financial, that offers a cryptocurrency called WLFI. Just days before his inauguration, he also began selling a so-called memecoin — a type of cryptocurrency tied to an online joke or a celebrity figure.
The notion of a U.S. crypto reserve gained traction last year as Mr. Trump embraced the industry on the campaign trail. Proponents argued that an investment in Bitcoin would help the government chip away at the $36 trillion national debt, and ensure that the United States remained dominant in a hypothetical future where the global economy runs on cryptocurrencies.
But skeptics said the plan seemed calculated to enrich crypto executives who already owned large amounts of Bitcoin by lifting its price. They argued that it was dangerous to link the nation’s economic future to a highly volatile asset.
At a conference in Nashville in July, Mr. Trump gave a speech to a crowd of Bitcoin enthusiasts and vowed to establish a national stockpile. He doubled down on that promise last weekend, posting on social media that he intended to create a reserve consisting of Bitcoin and other lesser-known cryptocurrencies, such as Solana, Cardano, Ether and XRP.
That plan drew criticism from some crypto executives, who argued that the only asset in a national reserve should be Bitcoin, the most valuable cryptocurrency on the market.
Under the order, the government will create a separate stockpile of digital assets other than Bitcoin. But it will include only coins that were acquired in criminal or civil seizures, and the government will not move to buy any cryptocurrencies except Bitcoin.
Crypto investors celebrated the announcement on social media, calling it a “historic day” and a “massive win” for the country.
“By holding Bitcoin and other digital assets for the long term, the White House is taking a future-forward approach,” Nathan McCauley, the chief executive of the crypto firm Anchorage Digital, said in a statement. “Expect this move to catalyze crypto adoption among more governments and institutions.”