US President Donald Trump’s announcement of a “Crypto Strategic Reserve” has sparked concerns among experts over the potential misuse of taxpayer funds. The proposal involves buying billions of dollars’ worth of cryptocurrency assets, including bitcoin and ether, to fill the reserve.
Critics argue that there is no strategic reason for the government to own crypto assets, as they have no use value either to the US government or the American economy. In contrast, the Strategic Petroleum Reserve has proven useful in times of economic uncertainty by maintaining oil supplies.
The proposed reserve would require significant financial resources and could be used to fuel speculation in the cryptocurrency market, creating conflicts of interest for regulatory bodies. Additionally, experts warn that such a move would institutionalize Trump’s administration’s accumulating conflicts of interest.
Supporters of the proposal claim it would strengthen the dollar by driving up crypto prices, but this argument has been met with skepticism from economists and financial experts. The proposal has also raised concerns about corruption and favoritism towards certain cryptocurrency projects.
As the US government already holds a significant amount of bitcoin and ether, seized from criminals, one option would be to simply hold on to those assets. However, proponents want to fill the reserve by buying billions of dollars’ worth of crypto assets, which could be seen as a handout for crypto holders at the expense of taxpayers.
Experts urge caution and call for a more transparent explanation of how the reserve will be acquired and managed, as well as a thorough assessment of its potential benefits and risks.
Source: https://www.theatlantic.com/ideas/archive/2025/03/strategic-cryptocurrency-reserve-swindle/681917