“Never sell your bitcoin,” Donald Trump told a cheering crowd at a cryptocurrency convention in Nashville, Tennessee, in late July.
The Republican presidential candidate’s speech was part of his effort to woo crypto-focused voters ahead of the November election, promising a plan to create a state-owned bitcoin reserve.
"If elected, it will be the policy of my Administration to hold 100% of all bitcoin that the United States Government currently holds or acquires in the future," Trump said, adding that the funds would serve as the "core of the strategic national stockpile of bitcoin."
Trump is not alone in his proposal. Senator Cynthia Lummis has suggested legislation allowing the U.S. government to buy one million bitcoins, about 5 percent of the total supply, while independent candidate Robert F. Kennedy Jr. has proposed a government stockpile of four million bitcoins.
The U.S. government currently holds about $11.1 billion worth of cryptocurrency, including 203,239 bitcoins seized from criminals. At current levels, this represents about 1% of the global bitcoin supply, capped at 21 million tokens.
"That would have a positive impact on the price. It would have to because we've never had a commodity in such limited supply, albeit digital, take on a new status as a reserve asset," said Mark Connors, head of global macro at Onramp Bitcoin.
However, a state reserve also means fewer bitcoins for investors to trade, which could expose them to risk if the government decides to sell some of its reserves.
"RFK talked about owning 19% of bitcoin, the same amount as the gold supply -- I can't imagine a single bitcoiner would be happy about that," Connors added.
In addition to the United States, China also holds large amounts of bitcoin, with 190,000 tokens, making it the second-largest government holder.
“There’s a lot to look at and figure out,” said Frank Kelly, senior policy strategist at DWS Group, about the possible form of a national bitcoin reserve.
Despite the uncertainty, many in the market are pleased to see cryptocurrencies becoming a key focus of the election campaign. “There is a general view in the industry that both parties are paying much more attention to digital assets,” said Raoul Mewawalla, chief executive of Mawson Infrastructure Group. “We expect this to continue beyond November.”
