US Government Could Begin Buying Bitcoin to Build National Reserve
The US federal government may soon move from holding confiscated Bitcoin to actively purchasing the cryptocurrency, according to Cathie Wood, founder of ARK Invest.
Speaking on the “Bitcoin Brainstorm” podcast, Wood suggested the move could expand the national strategic Bitcoin reserve, which was created by executive order early in President Trump’s second term.
So far, the reserve has been populated mainly with roughly 198,000 BTC seized through law enforcement actions.
Wood said,
“It seems as though there has been reticence about actually buying Bitcoin for the strategy reserve. So far, it's confiscated [bitcoins]. The original intent was to own 1 million bitcoins, so I actually think they will start buying.”
Why Trump May Prioritise Bitcoin
Wood argued that crypto remains politically important for Trump, especially as he navigates the midpoint of his second term and potential midterm challenges.
She highlighted the president’s continued interest in the sector, partly driven by his family’s growing stake in cryptocurrency and the broader crypto community’s influence during his election campaign.
“The most important one is that he doesn’t want to be a lame duck. He wants to have another one or two productive years, and I think he sees crypto as a path to the future.”
Crypto Influence on US Policy
During the last election cycle, the crypto industry emerged as a significant political force.
Political action committees such as Stand With Crypto donated to campaigns nationwide, while several high-profile executives, including Wood herself, backed Trump personally.
Post-election, some of these figures continued advising the administration, which has also hosted crypto-related events funded by firms like Coinbase, Tether, and Ripple.
Trump signed executive orders to establish the Bitcoin reserve and a broader crypto stockpile while forming a working group led by Special Advisor David Sacks.
In July, this group published policy recommendations including granting the Commodity Futures Trading Commission authority to regulate spot trading in non-security digital assets.
The report also confirmed that both the Bitcoin reserve and crypto stockpile would be administered by the Treasury Department and capitalised using forfeited assets, though no new purchases have been made.
Could the Reserve Expand Through Market Purchases
While the initial reserve holds only confiscated Bitcoin, Wood believes the administration could soon explore budget-neutral strategies to acquire additional BTC.
The move would be similar to how gold is stored at Fort Knox, treating Bitcoin as a strategic national asset.
Wood also noted that the administration aims to secure a de minimis tax exemption to exempt small cryptocurrency transactions from capital gains tax.
Several states, including Florida and Texas, are pursuing similar legislation to support crypto reserves.
Crypto Market Stability and Institutional Adoption
Reflecting on 2025, Wood and ARK’s Lorenzo Valente discussed market volatility and flash crashes, noting that new institutional players could help stabilise Bitcoin’s market.
Wood also considered the four-year cycle of Bitcoin, suggesting that if the market only sees a 30% decline instead of more severe drops, it would indicate progress in adoption and stability.
With strategic reserves, tax exemptions, and political backing, Wood predicts that the Trump administration sees cryptocurrency not just as an asset but as a tool for economic and political influence.