As of the end of April 2026, the US government held a total of 328,372 confiscated bitcoins, valued at approximately $26.7 billion at current market prices. This makes it the largest known sovereign bitcoin holder globally, accounting for about 1.56% of the total circulating supply. The scale of its holdings far outpaces other nations—by comparison, China is estimated to hold about 190,000 bitcoins, the UK around 61,000, and El Salvador, which was the first to adopt bitcoin as legal tender, holds only about 6,200.
It’s important to note that all these bitcoins were acquired through federal law enforcement seizures, not through direct government purchases. The primary sources trace back to three major enforcement actions: the Silk Road darknet case, asset recovery from the 2022 Bitfinex hack (with the Department of Justice seizing 94,636 bitcoins), and various criminal forfeiture proceedings over the past decade. Essentially, the US government did not become the world’s largest sovereign bitcoin holder by buying on the open market, but instead accumulated these digital assets passively through long-term criminal enforcement actions.
The legal nature of these holdings also differs from ordinary assets. Because they originate from judicial seizure procedures, the ultimate disposition of these assets is subject to complex judicial processes and fiscal decision-making mechanisms, rather than straightforward fiscal asset management. This legal gray area is a key prerequisite for determining whether these assets can be formally included as "strategic reserves."
Why Is an Executive Order Insufficient for Establishing a Permanent Bitcoin Reserve?
In March 2025, the sitting president signed Executive Order No. 14233, outlining a framework for establishing a US Strategic Bitcoin Reserve (SBR). The order set forth three core principles: consolidating all federally held bitcoins into a single reserve account, prohibiting the sale of seized assets, and exploring "budget-neutral" accumulation strategies—explicitly forbidding the use of taxpayer funds for open market purchases.
However, from a policy design perspective, executive orders have a fundamental flaw: they lack legal permanence. An executive order is essentially a policy statement by the current administration, which the next administration can modify or revoke at any time. Without Congressional legislation, there is no way to establish the "strategic reserve" as a permanent national asset. The Treasury Secretary has publicly stated that bitcoin sales have ceased and confirmed that these assets are being moved into reserves, but this commitment is still just "the current administration’s policy intention," not a long-term institutional guarantee that taxpayers can rely on.
This is precisely why Senator Cynthia Lummis’s push for the BITCOIN Act is the most crucial legislative variable in this debate.
What Kind of Permanent Reserve Structure Is the BITCOIN Act Trying to Establish?
In March 2025, Senator Cynthia Lummis reintroduced the "BITCOIN Act of 2025" (fully titled "Boosting Innovation, Technology, and Competitiveness through Optimized Investment Nationwide Act") to the US Senate, aiming to establish a strategic bitcoin reserve system through legislation. H.R. 1008, known as the "Bitcoin for America Act," seeks to allow federal taxes to be paid in bitcoin. While related to the reserve topic, its core focus is on tax payment mechanisms, fundamentally different from the reserve-building approach of the Lummis bill.
The BITCOIN Act sets a clear institutional framework: it requires the US Treasury to establish a strategic bitcoin reserve, accumulate 1 million bitcoins over five years (currently valued at about $81 billion), and unify and manage all government-held bitcoins. The bill also proposes a ban on selling reserve assets for a set period, aiming to create a permanent national asset allocation similar to the US Strategic Petroleum Reserve.
On the House side, corresponding legislative efforts are led by Congressman Nick Begich, whose "American Reserves Modernization Act" (ARMA) updates both the name and content based on the BITCOIN Act. Recently, White House advisors have indicated that legislation related to the strategic bitcoin reserve may be bundled into the must-pass National Defense Authorization Act (NDAA) by the end of 2026—this path is considered a "guaranteed passage" route that Congress is unlikely to reject.
Meanwhile, a wave of "gray-scale experiments" is unfolding at the state level. The Texas Senate has already passed a strategic bitcoin reserve bill (SB 21), establishing a state-level bitcoin reserve and advisory committee, setting a national precedent. The Pennsylvania House has proposed allowing the state treasurer to use "up to 10%" of state funds to purchase bitcoin, and Arizona, Ohio, and New Hampshire have completed voting procedures for similar bills in both chambers. Although states like North Dakota and Montana have rejected similar proposals due to fiscal conservatism, the state-level front continues to expand, providing a "political pilot" experience that indirectly supports federal legislation.
What Does the Removal of About $12.8 Billion in Annual Sell Pressure Mean?
Before the executive order was signed, the US government followed a long-standing tradition of regularly auctioning off confiscated bitcoins. On-chain data analysis shows that previous periodic sales by the Department of Justice and US Marshals Service averaged around 10,000 bitcoins per year. At the earlier average price of about $82,000 per bitcoin, this equated to roughly $820 million in annual sell pressure—at more recent, higher prices, this figure could reach up to $12.8 billion. Compared to the daily net inflows of mainstream ETF products, this locked supply is equivalent to removing about four to six weeks’ worth of net inflows from sell-side pressure.
After the executive order took effect, the Treasury announced it would "stop selling bitcoin" and move the assets into strategic reserves. The "in-only, no-out" principle for reserve assets fundamentally changed the government’s auction-driven behavior. If Congress passes the BITCOIN Act, this reduction in sell pressure will shift from a current policy choice to a permanent structural arrangement that spans political cycles.
This impacts the market in two ways: First, from a secondary market liquidity perspective, hundreds of millions in potential annual sell pressure are eliminated, effectively reducing a stable source of "passive sell pressure" on the supply side. Second, from a market expectation standpoint, investors no longer need to treat "when will the government auction bitcoin" as an uncertainty variable, allowing bitcoin’s market pricing to revert more to basic supply and demand fundamentals.
Looking at the broader supply landscape, the US government’s 328,000+ bitcoin holdings, the largest corporate holder Strategy (formerly MicroStrategy) with over 738,000 bitcoins, and institutional products like spot ETFs collectively hold about 1.26 million bitcoins. Together, these three entities control more than 2.3 million bitcoins, or roughly 11.6% of total circulating supply. The "in-only, no-out" reserve principle turns the government’s holdings from a potential supply variable into a structural locked position, further intensifying the long-term trend of "liquidity freeze" in the market.
What Key Steps Are Still Missing in the Transition from "Executive Order" to "Federal Law"?
Three steps are critical for moving from framework to legal guarantee.
First is transparency in cross-agency integration and audit verification. White House digital asset advisor Patrick Witt recently acknowledged that auditing decentralized holdings across federal agencies is a highly complex process, with some cold wallets reportedly stored in desk drawers at agency offices. The $60 million digital asset theft at the US Marshals Service in early 2026 highlighted the urgent need for centralized custody and security management. Witt stated that internal audits are nearly complete, which is the main reason for the upcoming "major announcement in the next few weeks."
Second is establishing a "budget-neutral" accumulation mechanism. The executive order explicitly prohibits using taxpayer funds to purchase bitcoin. This means that to achieve the BITCOIN Act’s goal of acquiring 1 million bitcoins over five years, a feasible "budget-neutral" path must be designed—such as using tariff revenue adjustments, asset reinvestment, and other fiscal tools to accumulate bitcoin without directly tapping tax funds. This is a major institutional design challenge requiring both technical feasibility review and fiscal compliance.
Third is the synergistic effect of H.R. 1008 (Bitcoin for America Act). This House bill aims to allow federal taxes to be paid in bitcoin. While its direct goal differs from reserve creation, if passed, it would increase the likelihood of the federal government acquiring bitcoin through tax channels, essentially providing a "natural inflow" mechanism for reserves. This proposal could have a structural impact on both secondary market circulation and new sources for the reserve pool.
How Is the Supply-Side Locking Effect Reshaping Bitcoin Market Structure?
Placing America’s strategic reserve within the broader market structure reveals a clear structural trend: bitcoin’s circulating supply is undergoing a shift from "highly decentralized" to "institutional locked" holdings. The three main entities (US government, Strategy, spot ETFs) now hold over 2.3 million bitcoins, more than one-tenth of the total circulating supply.
This configuration has dual market effects. On the positive side, the tradable supply is shrinking, causing bitcoin balances on exchanges to decline steadily, which amplifies price elasticity during bull markets—new buyers only need to absorb a smaller floating supply to drive prices higher. Strategy employs a "hold-first, never-sell" strategy, spot ETFs are inherently locked in custody, and the US government’s "in-only, no-out" reserve arrangement creates a multi-entity structural "supply black hole."
However, this setup also carries potential vulnerabilities. In bear markets or during black swan events, low liquidity environments often lead to sharper and harder-to-recover bitcoin price declines. With only about 2.4 million bitcoins left on exchanges and locking mechanisms in place, the window and space for bottom-fishing capital to buffer declines with limited chips are weakened. Furthermore, the high concentration of holdings objectively creates a pricing system centered around a few core entities, which introduces a certain degree of tension with bitcoin’s original decentralized narrative.
What Signals Have Recent White House Statements and Senate Hearings Sent?
On April 26, 2026, Patrick Witt announced at Bitcoin 2026 (Las Vegas) that the White House would issue a major announcement on the strategic bitcoin reserve "in the next few weeks," revealing that his team had made "breakthrough progress" in integrating the legal framework. This is the clearest timeline the White House has given on SBR since the executive order was signed in March 2025.
Witt noted that the operational details of the Treasury’s SBR office, the complete audit report of federal agency holdings, and the implementation plan for "budget-neutral" accumulation could all be central elements of this announcement. He also confirmed that the Senate’s BITCOIN Act and the House’s ARMA bill are the "main legislative tools" for securing legal guarantees.
In May, the Senate Digital Assets Subcommittee plans to hold a hearing on the bitcoin strategic reserve, where Lummis and other bill sponsors will present the progress and national strategic necessity of the BITCOIN Act. If the hearing generates positive momentum, it will further increase the likelihood of the bill successfully being attached to the NDAA before year-end.
Conclusion
The US government’s arrangement for 328,372 bitcoins is steadily moving from a single administration’s policy preference toward an "institutionalized" phase that spans administrative cycles. The executive order has established the foundational framework of "prohibition of sale" and "inclusion in strategic reserves"; the Senate’s BITCOIN Act and the House’s ARMA bill aim to elevate this framework to an irrevocable legal regime. With the White House’s recent statement to "announce updates within weeks" and the Senate hearing scheduled for May, the market should prepare for the following structural scenario: the annual supply pressure from government sales—amounting to tens or even hundreds of billions—could be permanently eliminated, while state-level legislative experiments and federal bills advance in tandem, collectively charting the course for digital assets to become a core national holding. These changes do not constitute short-term price predictions, but they are undoubtedly key contextual variables for assessing bitcoin’s medium- and long-term supply and demand fundamentals.
FAQ
Q1: What percentage of the global circulating supply does the US government’s 328,372 bitcoin holding represent?
According to available data, the US government’s roughly 328,000 bitcoins account for about 1.56% of the current total circulating supply. Compared to other sovereign nations, China is estimated to hold about 190,000, the UK about 61,000, and El Salvador about 6,200. Thus, the US government’s holdings far exceed those of other sovereign states, at about 1.7 times the amount held by China, the second largest sovereign holder.
Q2: Is there a difference between the BITCOIN Act and the ARMA bill?
Their objectives are aligned. The BITCOIN Act, led by Senator Cynthia Lummis, aims to acquire 1 million bitcoins over five years; the ARMA bill, pushed by Congressman Nick Begich, is the House’s revised and related version.
Q3: Why does bitcoin held under an executive order still require legislative protection?
An executive order is a policy directive issued under the president’s unilateral administrative authority and does not have enduring legal force beyond a single term. The next administration can unilaterally abolish or amend the reserve arrangement. Only a reserve plan formally legislated by Congress can provide permanent institutional protection across political cycles.
