Trump Confirms Bitcoin Reserve Plans Amid Crypto Cold War Concerns

President-elect Donald Trump has confirmed plans to establish a U.S. Bitcoin (BTC) reserve. Speaking at the New York Stock Exchange, Trump emphasized the need for the United States to stay ahead of nations like China and Russia, with the latter also reportedly considering implementing a Bitcoin reserve strategy of their own.

The plan aligns with the Bitcoin Act proposed by Senator Cynthia Lummis, which calls for the U.S. Treasury and Federal Reserve to purchase 1 million BTC over five years, at an estimated cost of $100 billion. Current U.S. holdings of 200,000 confiscated BTC, valued at $20 billion, could serve as the foundation for this reserve.

Russia Enters The Race

Like the U.S., Russia is also considering a Bitcoin reserve strategy, with President Vladimir Putin praising the flagship cryptocurrency for its performance and viewing it as a way to counter economic restrictions, raising the specter of a crypto cold war. After enduring economic sanctions and seeing foreign currency reserves frozen, Putin believes Bitcoin could provide a means to bypass the global financial system dominated by the U.S. dollar.

Bitcoin Price Projections Soar

The growing adoption of Bitcoin by governments worldwide has fueled predictions of unprecedented price growth. Perianne Boring, founder of The Digital Chamber, forecasts Bitcoin could exceed $800,000 by 2025, while the stock-to-flow model of PlanB suggests peaks near $1 million.

Institutional players like BlackRock add further weight to this potential upward trajectory, recommending a 1-2% portfolio allocation. BlackRock estimates that even a 2% global reserve allocation to Bitcoin could push its price to $900,000. Despite the excitement, critics warn of heightened volatility and a possible correction soon.