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- Congressman Warren Davidson is introducing a new reserve bill where the U.S. Treasury would hold seized Bitcoin in a secure, unified system with strict controls.
- The new reserve bill would expand BTC use for tax payments, encouraging adoption of the leading coin.
U.S. lawmakers are pushing forward with the creation of a strategic Bitcoin (BTC) reserve by introducing a new bill. Lawmakers described the new reserve bill as a move to build a Fort Knox for Bitcoin.
U.S. Shifting to Strategic Bitcoin Piling
Analytics platform CryptoRus highlighted the development on X, citing a recent FOX Business interview with Congressman Warren Davidson
In the interview, Davidson noted that the U.S. is evolving from mishandling seized cryptocurrencies to strategically stockpiling Bitcoin. This could potentially turn the leading coin into a cornerstone of national finance.
Historically, U.S. federal agencies have seized billions in crypto from criminal cases, like the Silk Road bust. As highlighted in our previous article, the U.S. government once received approval to liquidate 69,370 Bitcoin seized from the Silk Road darknet marketplace.
However, poor record-keeping has led to lost private keys, the digital passwords needed to access the funds. This has resulted in inaccessible billions, similar to locking cash in a safe and losing the combination.
As a solution to this problem, U.S. President Donald Trump signed an executive order in March to create a strategic Bitcoin reserve. This order mandates transferring all federally seized Bitcoin to the Treasury for centralized, secure storage. While critics worry about volatility, proponents see it as a hedge against dollar inflation.
To make the strategic Bitcoin reserve permanent via legislation, Congressman Davidson introduced a new bill on November 20, 2025.
Key Features in the New Bitcoin Reserve Bill
The bill introduces innovative features that treat Bitcoin as a preferred asset.
A key feature includes centralizing seized Bitcoin holdings to avoid losses. Another feature of the bill focuses on treating BTC differently from other cryptocurrencies.
While the crypto reserve holds BTC indefinitely, other seized digital assets can be auctioned off. Proceeds from sales would be used to fund BTC acquisitions, ensuring no new spending.
The new bill also proposes allowing direct BTC transfers to the Internal Revenue Service (IRS) for taxes. This is a key innovation, as normally, selling BTC for fiat taxes triggers capital gain.
Davidson argued for holding BTC long-term, not selling it off like past agencies did. To back his argument, he noted that Bitcoin, which traded around $500–$600 when he came into office, has surged by tens of thousands. This highlights BTC’s massive appreciation.
Proponents view a strategic BTC reserve as a hedge against debt, inflation, and dollar dominance erosion. In a previous article, we discussed that Alex Thorn, the head of research at Galaxy Digital, said the U.S. could establish a Strategic BTC Reserve by year-end.
Globally, nations like Taiwan, the UAE, and Bhutan are already exploring creating a strategic BTC reserve.
Despite the optimism surrounding the creation of a strategic BTC reserve, skeptics fear volatility or regulatory overreach.
