US Establishes Strategic Bitcoin Reserve
The United States has taken a significant step towards incorporating Bitcoin into its financial strategy. On 7 March, President Donald Trump signed an executive order to create a “Strategic Bitcoin Reserve” and a “Digital Asset Stockpile.” The initiative, funded by Bitcoin and other digital assets seized in government criminal cases, marks a shift in the US approach to cryptocurrency.
With the US embracing Bitcoin as a strategic asset, speculation is growing over whether China will respond with its own national crypto policy to avoid falling behind in the emerging digital asset race.
China’s Undisclosed Bitcoin Holdings
If China adopts a similar Bitcoin reserve strategy, it could become one of the largest BTC holders in the world. The US government currently holds 198,109 BTC, valued at over $17 billion. However, it has stated that it will not sell its Bitcoin reserves but will instead hold them as a long-term store of value. Additionally, Washington plans to implement “budget-neutral strategies” to acquire more Bitcoin.
China, on the other hand, has never officially disclosed its Bitcoin holdings or any sale strategies. In 2020, Chinese authorities seized nearly 195,000 BTC from the PlusToken Ponzi scheme. According to a ruling from the Yancheng Intermediate People’s Court, profits from the confiscated assets were transferred to the national treasury.
Despite speculation, it remains unclear whether Beijing has sold these holdings or retained them. On 23 January, CryptoQuant CEO Ki Young Ju suggested that China may have already liquidated its Bitcoin, arguing that the government would be unlikely to hold “censorship-resistant money.” However, this remains unconfirmed.
China’s Potential Bitcoin Reserve Strategy
If China still holds its Bitcoin reserves and adopts a policy similar to that of the US, it could rival Washington in digital asset accumulation. Jan3 CEO Samson Mow believes the establishment of the US Strategic Bitcoin Reserve will have far-reaching consequences, potentially sparking a global race for national Bitcoin reserves.
Mow highlighted “budget-neutral” ways to acquire Bitcoin, such as issuing bonds or selling gold. He also pointed out that the US might have only 112,000 BTC or less, as a large portion of its holdings will be returned to the crypto exchange Bitfinex. This situation could put China in a leading position with its 195,000 BTC stash.
Given geopolitical rivalries, the US is unlikely to accept a scenario where China holds a greater Bitcoin reserve. This could push Washington to further expand its holdings, escalating the digital asset competition between the two economic superpowers.
Hong Kong’s Role in China’s Crypto Strategy
While China’s official stance on Bitcoin reserves remains unclear, Hong Kong lawmakers are exploring the potential for cryptocurrency adoption under the “one country, two systems” framework. On 30 December, Wu Jiexhuang, a member of Hong Kong’s Legislative Council, suggested that the region could study the market impact of spot Bitcoin exchange-traded funds (ETFs) in the US. He noted that Trump’s proposal to establish Bitcoin as a strategic reserve asset might have implications for traditional financial markets.
As the US moves forward with its Bitcoin reserve strategy, all eyes are on China to see whether it will follow suit or maintain its cautious approach to cryptocurrency. The outcome could shape the future of national digital asset reserves and influence global financial markets for years to come.
