Trump's Bitcoin Reserve Plan Hits Roadblock

Legal Questions Stall the Reserve

The Trump administration's proposed Strategic Bitcoin Reserve, one of the centrepiece commitments of its pro-crypto agenda, has run into legal and bureaucratic complications. According to Bloomberg, a concern has emerged about whether the Treasury Department is legally able to manage the crypto trove, according to people familiar with the matter who were not authorized to speak publicly.

Trump signed an executive order in March 2025 to establish the reserve as a permanent reserve asset, funded by Treasury's forfeited Bitcoin. Under the order, the United States would not sell Bitcoin deposited into the reserve, and the Secretaries of Treasury and Commerce were authorized to develop budget-neutral strategies for acquiring additional Bitcoin, provided those strategies impose no incremental costs on American taxpayers.

One of the core questions is whether the government can hold Bitcoin indefinitely, especially given the asset's volatility. Bitcoin acquired through forfeiture is usually tied to law enforcement outcomes, not a long-term national reserve strategy. Turning seized assets into a permanent strategic holding may require clearer legal authority than simply transferring custody between agencies.

Commerce Department and DOJ Enter the Picture

Multiple parts of the administration are now involved in crafting a plan to ensure the Strategic Bitcoin Reserve is legally viable. Concerns that holding a volatile digital asset indefinitely may exceed Treasury's legal remit have prompted Commerce to be floated as a potential custodian, while the Office of Legal Counsel coordinates options.

The Justice Department said in a statement that its Office of Legal Counsel "is working closely with both the Treasury and Commerce departments to determine legally available options to accomplish the president's policy of establishing a strategic Bitcoin reserve."

The White House, for its part, is not backing away from the commitment. White House spokesperson Liz Huston said: "President Trump campaigned on a vision of cementing America as the global capital of cryptocurrency and other cutting-edge technologies. To deliver on the President's vision, the Trump administration continues to evaluate the best structure for a Strategic Bitcoin Reserve and U.S. Digital Asset Stockpile."

The stakes are considerable. The United States federal government is the largest known state holder of Bitcoin in the world, estimated to hold about 328,372 BTC as of February 2026. Premature sales of Bitcoin have already cost U.S. taxpayers over $17 billion, according to the White House. Meanwhile, lawmakers are already working on bills that would codify Trump's executive order. One proposal from Senator Cynthia Lummis and Representative Nick Begich would include language for acquiring one million Bitcoin over five years using budget-neutral strategies.

In April, the White House's top crypto adviser Patrick Witt said he had expected a "big announcement" in the coming weeks on next steps for the reserve, but it has not yet materialized. Until the legal framework is resolved, one of the Trump administration's most high-profile digital asset pledges remains on hold.

Sources:
Bloomberg: Trump Bitcoin Reserve Faces Hurdles as Departments Seek Control
The Block: Trump Strategic Bitcoin Reserve Hits Legal and Jurisdictional Snag
White House Fact Sheet: President Trump Establishes the Strategic Bitcoin Reserve