5 min readBitcoin is rising for the second consecutive day, rebounding from 101K yesterday to above 105K on Friday. BTC’s rise comes following President Trump signing the first executive order aimed at promoting the growth of crypto in the U.S. The order has sparked speculation about the potential creation of a national digital asset reserve.
However, it’s not only Bitcoin that is gaining; other cryptocurrencies are also seeing upward movement, resulting in an overall crypto market valuation of $3.6 trillion. Specifically, Ethereum rose to $3,400, and Solana increased to $265.
What is Trump’s executive order for crypto?
Trump’s first executive order on crypto is “Strengthening American Leadership in Digital Financial Technology.” Key policies include protecting and promoting citizens’ and institutions’ ability to use digital assets and developing the growth of US dollar-backed stablecoins globally. Trump also established the President’s Working Group on Digital Asset Markets to evaluate regulations that impact the digital asset industry and set out a framework for the industry.
The majority of the order emphasizes the creation of technologies and regulations associated with crypto and its advancement in the U.S. However, the group will also investigate the idea of a national digital asset reserve, which has led to speculation about a possible Bitcoin national reserve.
Will Trump create a Bitcoin national reserve?
During his election campaign, Trump introduced the idea of a national Bitcoin reserve. Optimism surrounding the idea, together with the potential for more cryptocurrency-friendly regulations, contributed to Bitcoin’s rise of over 50% within a span of just two months.
Trump has previously suggested that a Bitcoin national reserve could be used to pay down some of the US’s $35 trillion debt. The plan would be to purchase 1 million BTC over 5 years, equating to around 5% of the total global Bitcoin supply.
The task force has until July to submit its report, and given the likely impact on Bitcoin’s price, the industry will scrutinise the outcomes closely.
How could a strategic Bitcoin reserve impact BTC?
Given the US’s influence over other countries, creating a strategic reserve could encourage other nations to start buying Bitcoin in large quantities. Should Chinna and Russia get involved, this could pave the way for a Bitcoin arms race, potentially propelling the price sharply higher. Furthermore, such a move could accelerate mainstream adoption.
While these latest developments are a step in the direction of making a Bitcoin nation reserve a reality, there could be more action at a state level first. Ten US states already have Bitcoin reserves; these include Texas, Florida, and Pennsylvania.
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