Trump Signs Executive Order to Create Sovereign Wealth Fund, Sparking Bitcoin Speculation
US President Donald Trump has signed an executive order (EO) directing the government to initiate the process of establishing a sovereign wealth fund.
The announcement, made during a press event in the Oval Office on Feb. 3, has sparked speculation about the potential involvement of Bitcoin (BTC) in the fund’s portfolio.
The EO tasks Treasury Secretary Scott Bessent and Secretary of Commerce Howard Lutnick with laying the groundwork for the fund, which aims to “monetize the asset side of the US balance sheet.” Bessent confirmed that the directive would be implemented “within the next 12 months,” though specific details on funding sources and investment strategies remain unclear.
Also read: Bitcoin Strategic Reserve Explained
While the Trump administration has not explicitly mentioned Bitcoin or other cryptocurrencies as potential assets for the fund, industry advocates and at least one lawmaker have raised the possibility.
Wyoming Senator Cynthia Lummis took to X to hint that the sovereign wealth fund could be used to acquire BTC. Additionally, Bitcoin advocate Wayne Vaughan suggested that both Bessent and Lutnick “like Bitcoin,” fueling speculation that crypto could play a role in the fund’s strategy.
Bitcoin and the Sovereign Wealth Fund
The creation of a US sovereign wealth fund would mark a historic shift in government financial policy, typically associated with countries rich in natural resources like Norway and Saudi Arabia. Trump and his cabinet members have indicated that the fund may look at acquiring strategic assets, with TikTok’s US operations emerging as one potential target. The video-sharing app, owned by China’s ByteDance, faces legal pressures requiring it to divest its US business or risk a nationwide ban.
Also read: Illinois Moves Forward with Strategic Bitcoin Reserve Bill, Following Arizona’s Lead
Bitcoin proponents argue that adding BTC to the fund could serve as a hedge against inflation and economic instability. The concept of a government-backed Bitcoin reserve has gained traction among crypto advocates, particularly as Trump has previously expressed openness to embracing Bitcoin-friendly policies. His campaign promises have included the creation of a Bitcoin stockpile, ensuring BTC mining remains within US borders, and halting the development of a central bank digital currency (CBDC).
Trump Legal Challenges and Market Reaction
Trump’s use of executive orders has frequently led to legal challenges, and this latest directive is unlikely to be an exception. Since taking office on Jan. 20, the president has signed multiple EOs that have faced immediate lawsuits, including one attempting to revoke birthright citizenship. Legal experts have questioned whether an EO alone can establish such a large-scale financial entity without congressional approval.
Also read: Is a Bitcoin Reserve on the Horizon? Trump’s Victory Sparks Excitement for a $1 Million BTC
Meanwhile, Bitcoin’s price exhibited volatility in response to the news. The cryptocurrency briefly dipped below $100,000 over the weekend following Trump’s announcement of tariffs on imports from Canada, China, and Mexico. However, after coverage of the sovereign wealth fund EO gained traction, BTC rebounded to over $101,000 at the time of publication.
If successfully implemented, the sovereign wealth fund could significantly impact both traditional and digital asset markets. While Trump’s administration has yet to clarify the fund’s asset allocation, growing interest from lawmakers and crypto advocates suggests Bitcoin could find its way into the US government’s portfolio.
Also read: Trump Crypto Agenda: Hopes for Reform Tempered by Reality, Says NYDIG
With the EO expected to take shape over the next year, all eyes will be on the Trump administration’s next steps—and whether the US will join the list of nations holding Bitcoin as part of its strategic financial reserves.
