XRP Lawyer Weighs In on Proposed US Strategic Bitcoin Reserve

The debate surrounding a potential Strategic Bitcoin Reserve (SBR) in the United States is intensifying. John E. Deaton, a lawyer known for his XRP advocacy, recently offered insights into the complexities of establishing such a reserve, highlighting the crucial role of legal and regulatory frameworks.

Deaton's Perspective on a Strategic Bitcoin Reserve

Deaton clarified that the term "Strategic Bitcoin Reserve" can have different meanings depending on the context. He suggested that an SBR could simply involve securely storing seized Bitcoin and other cryptocurrencies in a virtual vault rather than selling them. This, he noted, could potentially be achieved via a presidential executive order.

However, Deaton emphasized that a government initiative to directly purchase Bitcoin for an SBR would necessitate legislation. He cited Senator Cynthia Lummis's proposed bill as an example of how such a policy could be implemented. With Senator Lummis's new position as chair of the Senate's Digital Assets Subcommittee, there's renewed optimism among experts, including Binance founder CZ, regarding the potential for a strategic Bitcoin reserve.

Trump's Executive Order and the "Stockpile" vs. "Reserve" Distinction

President Trump's executive order focused on creating a "national digital asset stockpile," a distinction noted by Bloomberg analyst James Seyffart. Seyffart highlighted the difference between "stockpile" and "reserve," suggesting the former implies government retention of already-held assets (like those seized in law enforcement operations), not active market purchases. The executive order established a working group to develop guidelines for managing this stockpile.

Meanwhile, Pierre Rochard of Riot Platforms claimed Ripple Labs opposes a Bitcoin-centric reserve, alleging they are promoting XRP. This assertion has been refuted by Ripple's CEO, Brad Garlinghouse.

Current US Government Cryptocurrency Holdings

Data from Arkham Intelligence indicates that the US government currently holds approximately 198,109 BTC (valued at roughly $20 billion), along with smaller amounts of Ethereum, stablecoins, and other tokens. These holdings primarily stem from law enforcement activities. The executive order doesn't mandate the government retain all these assets indefinitely; rather, it emphasizes creating guidelines to determine which assets should be kept.

Analysts like Alex Thorn and James Seyffart believe this approach is a logical and measured strategy, suggesting that not all seized assets will be held permanently.

Codeum Note: Codeum offers comprehensive blockchain security services, including smart contract audits, KYC verification, custom smart contract and DApp development, tokenomics and security consultation, and partnerships with launchpads and crypto agencies. We help projects navigate the complexities of the crypto space securely and efficiently.