United States Treasury Secretary Scott Bessent reiterated that the government would not be buying additional BTC for the strategic reserve created by President Donald Trump in a March 7 executive order.
Speaking to Fox Business on August 14, when asked about U.S. gold reserves, Bessent said the U.S. had also started “to get into the 21st Century,” with its Strategic Bitcoin Reserve, which he hinted would remain as a store of value.
Bessent confirmed that already seized assets would continue to be held, no BTC would be sold (in the immediate future), and that further seizures could add to the government’s holdings over time.
“We’re not going to be buying that [bitcoin] but are going to use confiscated assets and continue to build that up, we’re going to stop selling that,” said Bessent. “I believe that the bitcoin reserve at today’s prices is somewhere between $15 and $20 billion.”
Bitcoin analytics platform Bitbo estimated that, as of December 2024, the U.S. government owned 198,012 bitcoins, which would currently be valued at around $23.6 billion.
Almost half of this—94,643 BTC—came from assets seized from Ilya Lichtenstein and Heather Morgan in February 2022, following a probe into the August 2016 hack of digital asset exchange Bitfinex.
Bitcoin Reserve
President Trump officially announced that the U.S. would create a Strategic Bitcoin Reserve on March 7, when he signed an executive order titled “Establishment of the Strategic Bitcoin Reserve and United States Digital Asset Stockpile.“
The executive order introduced the idea of a strategic reserve exclusively for BTC, where previously it had been rumored that the reserve may also include other digital assets.
Based on Bessent’s comments, the BTC reserve is being treated like a traditional strategic reserve, i.e., a stockpile of an asset, typically a commodity, that the U.S. government builds up and taps into during times of catastrophe, economic turmoil, or crisis. However, the executive order is somewhat vague, simply stating that the BTC Strategic Reserve would be “utilized to meet governmental objectives in accordance with applicable law.”
The executive order also established a U.S. Digital Asset Stockpile, consisting of digital assets other than BTC forfeited in criminal or civil proceedings. However, the government already confirmed it would not acquire additional assets for the stockpile beyond those obtained through forfeiture proceedings.
Much to the disappointment of crypto bros worldwide, the executive order made clear that the Strategic Bitcoin Reserve would not be built up through the large-scale purchasing of BTC with public funds. Rather, it is to be “capitalized with all BTC held by the Department of the Treasury that was finally forfeited as part of criminal or civil asset forfeiture proceedings or in satisfaction of any civil money penalty imposed by any executive department or agency.”
This means that the reserve relies on BTC seized by U.S. government agencies as a result of arrests or as payment for penalties.
Beyond this initial method of obtaining BTC, the executive order also mandates that the Secretary of the Treasury and the Secretary of Commerce “develop strategies for acquiring additional Government BTC,” provided the strategies remain budget-neutral and do not use taxpayer dollars.
It’s unclear what these “strategies” would be, but following his interview with Fox Business on Thursday, Secretary Bessent clarified in an X post that the Treasury department was still “committed to exploring budget-neutral pathways to acquire more Bitcoin to expand the reserve.”
While the Treasury ponders how to gain more BTC without spending money, U.S. law enforcement agencies are doing their part to expand the strategic reserve through more seizures.
More funds for the reserve
In April, the Dallas Federal Bureau of Investigation (FBI) seized $2.4 million BTC associated with a member of the Chaos ransomware group known as “Hors,” which has been tied to ransomware attacks against victims in the Northern District of Texas and elsewhere.
In July, the Department of Justice (DOJ) filed a lawsuit seeking a claim on the funds, as it “constitutes property involved in unlawful activity, or proceeds of or property derived from unlawful activity.”
On Wednesday, the DOJ appeared to make a further effort to increase the roughly $20 billion worth of BTC already in the U.S. Strategic Bitcoin Reserve, unsealing six warrants authorizing the seizure of over $2.8 million in digital assets.
All of the assets were seized from a wallet controlled by Ianis Aleksandrovich Antropenko, who was charged by the Northern District of Texas in September 2024 with conspiring to commit computer fraud and abuse and conspiracy to commit money laundering.
Antropenko allegedly used Zeppelin ransomware to target and attack various individuals, businesses, and organizations in the U.S. and worldwide. Specifically, he and his co-conspirators would encrypt and steal the victim’s data and then demand a ransom payment to decrypt it, refrain from publishing it, or delete it.
“As alleged in the unsealed warrants, the cryptocurrency and other assets are proceeds of (or were involved in laundering the proceeds of) ransomware activity,” said the DOJ.
The DOJ did not specify the amount of the soon-to-be seized funds that would be returned to victims and how much would remain with the government, or what amount of the digital assets—if any—were BTC, which could eventually make their way into the U.S. Strategic Bitcoin Reserve.
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Source: https://coingeek.com/us-treasury-confirms-bitcoin-reserve-will-rely-on-seizures/