Trump’s Bitcoin reserve order reshapes institutional crypto investment

President Donald Trump’s executive order establishing a US Strategic Bitcoin Reserve and a National Digital Asset Stockpile is expected to be a catalyst for wider Bitcoin adoption, according to investment analysts and crypto industry leaders.

On March 6, Trump acknowledged the need to “harness” the power of digital assets while signing the executive order for crypto assets, which states:

“Because there is a fixed supply of BTC, there is a strategic advantage to being among the first nations to create a strategic Bitcoin reserve.”

Ryan Rasmussen, the head of research at Bitwise, anticipates a cascading effect where other countries and private investors will invest in Bitcoin (BTC) with renewed confidence. “The end game was never ‘the US government buys all of the world’s Bitcoin,’” he said.

Large institutional investors, such as wealth managers, financial institutions and pension schemes, now have “no excuse” for not increasing exposure to Bitcoin and other crypto assets endorsed by the Trump administration. 

With the sell pressure reduced, the probability of the US government and individual states procuring Bitcoin has increased, Rasmussen said, adding:

“Probability the government outlaws Bitcoin is definitively zero.”

Andrew O’Neill, digital assets managing director at S&P Global Ratings, noted that the Bitcoin reservwouldll only include BTC already owned by the US government, specifically assets forfeited through criminal or civil procedures.

The presidentail order to hold Bitcoin “is mainly symbolic” for Bitcoin to be formally recognized as a reserve asset, O’Neill said. It also created a clear distinction between Bitcoin and other crypto assets: 

“The order does contemplate the possibility of acquiring additional Bitcoin for the reserve, provided it can be done in a budget-neutral manner.”

Related: Donald Trump signs executive order for Strategic Bitcoin Reserve

Speaking to Cointelegraph, Ryan Lee, chief analyst at Bitget Research, said he anticipated Trump unveiling more details about the strategic crypto reserve on March 7 at the White House crypto summit.

According to Lee, the summit’s outcome may significantly influence the regulatory landscape and institutional sentiment toward digital assets, shifting toward clarity on token classification, tax incentives and reduced enforcement actions, possibly dismantling barriers for banks and funds.

“A successful summit could see Bitcoin reclaim $100,000 and crypto assets like Ether (ETH), XRP (XRP), and Solana (SOL) soar, cementing US leadership in global crypto markets. Conversely, a lack of actionable steps might disappoint investors, underscoring the high stakes of this event.”

Germany panic sells 50,000 BTC at the bottom

While discussions of global Bitcoin adoption are underway, many crypto enthusiasts on X recollected Germany’s ill-timed decision to sell 50,000 BTC between June 19 and July 12, 2024, at an average market price of roughly $60,000 per BTC.

The German government had accumulated the 50,000 BTC stash through seizures from the movie piracy website movie2k. The sale of the proceeds generated around 2.6 billion euros ($2.87 billion).

The market value of 50,000 BTC is currently over $4.45 billion, according to data from Cointelegraph Markets Pro and CoinMarketCap. Germany’s hasty decision to sell the confiscated Bitcoin cost the government over $1.58 billion, considering a market price of $88,972.

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