Trump’s Bitcoin Reserve & Crypto Stockpile: Innovation or the Ultimate Grift? What are the Long-Term Implications?
Is President Trump’s pro-crypto play a fast-path to corruption or an overdue embrace of a maligned technology? Here's a full breakdown, including hypothetical corruption scenarios & past precedents.
On March 2, President Donald Trump announced by “truth” that a crypto reserve which would feature the cryptocurrencies Ripple (XRP), Solana (SOL), and Cardano (ADA). In a later post he added that Bitcoin (BTC) and Ethereum (ETH) would be included as well. This was historic news—I knew it immediately, and said so in my flash analysis that day.
As more has been revealed—including the White House Crypto Summit on March 7—I’ve had a chance to conduct a deeper analysis. What follows is designed for those with no understanding of crypto to grasp the basic ideas. To clarify: I’m not going to explain how blockchain technology works other than where necessary, but if you want an accessible explainer, I like this one from Reuters.
Some background for folks who may not know: I’ve been covering emerging technologies, including cryptocurrencies, since 2015. In Decemeber 2017, my articles about cryptocurrencies in Forbes accounted for 5% of all of Forbes.com site traffic. I curated the first-ever museum retrospective on the history of NFTs, and most recently worked as Arts & Culture advisor for Protocol Labs, an open-source research & development company whose key projects include IPFS and Filecoin.
Okay, let’s get to it.
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What is the Trump Crypto Reserve, and What Has Happened so Far?
In his March 2 announcement, President Donald Trump framed the crypto reserve as a move to “elevate this critical industry after years of corrupt attacks by the Biden Administration” and to make the U.S. “the Crypto Capital of the World.”
Though it hasn’t been implemented yet, other than the Bitcoin reserve described below, such a reserve would in theory use taxpayer dollars to buy the digital assets named above, marking a dramatic shift in U.S. financial policy (to put it lightly).
Critics immediately noted that this initiative “poses countless conflicts of interest—especially for Trump himself,” essentially amounting to a taxpayer-funded gift to the crypto industry.
This move appeared to make good on then-candidate Trump’s July 2024 campaign promise to create a “strategic national bitcoin reserve.”
The announcement triggered a trading frenzy, driving up the named coins’ prices (Bitcoin jumped over 10% and Cardano surged by nearly 70% that day), though they have all since fallen below their early March prices.
Executive Order
On Thursday, March 6, President Trump issued an executive order establishing a government stockpile of bitcoin. The move is more for show than anything; under the EO, the U.S. government will simply retain the estimated 200,000 bitcoin it has already seized in criminal and civil proceedings, according to Trump’s “crypto czar” David Sacks (who we’ll be discussing in more detail below).
With this EO, the White House appeared to adjust course, holding the bitcoin-only strategic reserve alongside a separate crypto stockpile comprised of ADA, ETH, SOL, and XRP.
In a March 7 episode of the All-In podcast, Sacks explained that the Bitcoin reserve would be moved “to the digital stockpile,” and that “the purpose of the stockpile is responsible stewardship, it’s a place for safekeeping, it’s a centralized account under the direction of the secretary of the Treasury and the secretary of the Treasury will figure out how to maximize the value of these holdings.”
White House Crypto Summit
On March 7, the White House hosted the first-ever “crypto summit,” bringing together key industry figures from Coinbase, Ripple, Gemini, Kraken, Chainlink, and Robinhood, emphasizing the administration’s intent to foster growth and innovation in the sector through clearer regulatory frameworks.
“Last year I promised to make America the Bitcoin superpower of the world and the crypto capital of the planet, and we're taking historic action to deliver on that promise,” Trump said in his address.
Trump also confirmed his commitment to bitcoin—seeming to elevate it to a position above other cryptocurrencies—in a reserve described as a “digital Fort Knox,” in a nod to the U.S. gold reserve.
Advocates, epitomized by the industry leaders in attendance at the summit, believe this crypto reserve is a chance to fortify U.S. economic supremacy worldwide.
“My job is not to encourage people to buy crypto. My job is to create an innovation framework for the United States,” Sacks said, adding that “we’re only allowed to buy more [cryptocurrencies] if it doesn’t add to the deficit or the debt or cost taxpayers,” seeming to address the concerns that taxpayer dollars would be used to build either the Bitcoin reserve or crypto stockpile.
Trump also later framed the move as a means of competing with China in tech.
“China is pushing forward very strongly as usual, but we're way in the lead, as we are in AI and other things, and we want to stay there,” Trump said.
Crypto Contraction
The initial trading frenzy after the March 2 announcement has died down—and the crypto market has continued to tumble, falling to its lowest market capitalization since the post-election surge.
Agne Linge, head of growth at crypto platform WeFi, told Forbes that the more constrained approach of the bitcoin reserve may have cooled short-term enthusiasm, while leaving the door open for long-term growth through geopolitical implications:
“The subpar strategic bitcoin reserve move triggered the uncertainty in the crypto market…. With the executive order directing agencies to consolidate seized bitcoin to form the reserve, crypto investors see the move as a trick, as no new bitcoin purchase was announced. Despite the knee-jerk reaction from investors, the fact is that the bitcoin reserve mandate authorizes the acquisition of bitcoin through means that will not cost taxpayers’ money. The available options in this regard include bitcoin bonds and the sales of its gold reserve to fund more purchases. In the long term, the bitcoin reserve shift might benefit the coin. This thesis hinges on a possible race it has triggered that may see other sovereign nations make similar moves.”
Blockchain Technology: Ideals vs. Realities
Blockchain and cryptocurrencies are not de facto bad or evil. The baseline of cryptography, distributed ledgers, and decentralized consensus protocols is rooted in worthy ideals—namely that of putting power in the hands of collectives rather than the centralized individuals and entities (which increasingly concentrate power).
Unfortunately, the confusing and unregulated “wild west” aspects of the technology also make it an ideal zone for graft, fraud, and ransoms (e.g., cyberattacks on hospitals frequently involve ransom payments in cryptocurrencies because they are easier to send without oversight and harder to track and retrieve once disbursed).
I resonate with something that Urgent Futures podcast
quipped, which is that the more boring the use case, the more likely blockchain is good for it.
As authoritarian regimes intensify around the world, for example, blockchain technologies could prove invaluable for preserving evidence of war crimes for posterity—a use case demonstrated by Starling Lab.
But there’s two sides to that coin. Cryptocurrencies also offer sneaky and expedient means for committing crimes for those very same authoritarian regimes.
Conflicts of Interest and Self-Dealing
Following the March 2 announcement, observers quickly pointed out that Trump’s crypto reserve could enrich Trump and his family.
Most obviously, Donald Trump and Melania Trump have both launched memecoins, which collectively have a current market capitalization of over $2.75B. These memecoins are tokens launched on the Solana blockchain (SOL), one of the three altcoins Trump named for the reserve. His inclusion of SOL in the announcement while holding these tokens is a clear conflict of interest, as such an announcement was likely to drive up the price of SOL, TRUMP, and MELANIA (and it did). Both Donald and Melania Trump have also dropped multiple NFT collections on the Solana blockchain—as well as on the Bitcoin blockchain and Ethereum-based Polygon network.
One report revealed that the Trump family’s crypto company, World Liberty Financial, “bought millions of dollars worth of crypto, including Bitcoin and Ether, hours before Trump was inaugurated.” Such timing suggests insider trading or foreknowledge: Trump’s family may have positioned themselves to profit knowing a government crypto-buying spree was coming. This kind of self-dealing—using public office to enrich private interests—has raised alarms among ethics experts and even some pro-crypto figures.
The move also stood to benefit Trump allies and donors.
Vanity Fair reported that several of Trump’s major campaign donors were crypto executives who poured roughly $130 million into his 2024 campaign. Those backers appear to be “getting what they paid for,” as the Trump administration has already rolled back crypto oversight and dropped investigations into major industry players since taking office.
The crypto reserve is seen as another payback: it would directly boost the value of assets held by Trump’s supporters. The Atlantic went so far as to describe the plan not as a strategic investment but as “a giveaway to Trump’s supporters.” Trump’s own Commerce Secretary (Howard Lutnick), AI and Crypto Czar (David Sacks), and key advisers are themselves crypto investors—meaning officials stand to profit from policies they’re enacting.
Why is the Crypto Reserve Ripe for Corruption?
By having the government buy cryptocurrencies, which are volatile digital assets, a president could manipulate markets for personal gain. This has to do with how all high-risk speculative markets work as well as the affordances of cryptocurrencies.
Trump hand-picked specific coins for the reserve, immediately causing their values to surge.
All cryptocurrencies remain fundamentally volatile, due to their vast reach and uneven regulatory frameworks around the world. They can be traded at all hours of the day, for example, and there are no “circuit-breaker” mechanisms to halt trading during severe market decline (as there are in the stock market).
Even the more stable cryptocurrencies, so-called ‘stablecoins,’ which are pegged to more reliable assets such as the U.S. dollar, are generally considered riskier than traditional currencies and assets. One of the worst crashes in the history crypto, for example, was the collapse of an algorithmic stablecoin called Terra Luna.
That caveat notwithstanding, Bitcoin—and to a lesser extent Ethereum—are considered the most reliable bets among cryptocurrencies, accounting for approx. 60% and 9% respectively of the the entire crypto market.
Critics note that by going beyond Bitcoin to include smaller altcoins, “Trump would be using U.S. taxpayer money to buy much riskier assets that have unproven value and [could] bolster the net worth of a select few investors who own the coins.”
In other words, if Trump or his associates held any of those tokens, the reserve announcement effectively pumps their bags while imperiling taxpayer dollars in investments that can be swayed rapidly by actors around the globe. In the same way that cryptocurrencies can foster corruption in the form of bribes, they can also create a context for individuals, entities, or nations to target coins in the reserve to manipulate its price down, or even attempt 51% attacks to “take over” the blockchain.
These concerns are not hypothetical—Trump’s past behavior reveals a pattern of monetizing his office.
Unlike past presidents, he never fully separated from his private business empire, leading to allegations that he profited from foreign officials patronizing his hotels while he was in office (in violation of emoluments rules).
He was also found to have misused charitable funds for personal benefit in his pre-presidency career.
With that track record, watchdogs worry Trump could treat the crypto reserve as a personal “slush fund.”
For instance, he might “play favorites” with certain tokens because friends or family are invested in them. Notably, all three altcoins in the reserve (XRP, SOL, ADA) are tied to U.S.-based projects—observers like investor Anthony Pompliano speculate that lobbyists pitched these as “Made in America” cryptos to appeal to Trump’s purported “America First” instincts. If true, it suggests special interests co-opted the President to include their coins, turning the reserve into a patronage vehicle. I put less stock in the “America First” angle than I do the “personal gain” one, but it certainly seems possible the former was great cloud cover for the latter.
Even the custody and management of a national crypto fund raise corruption red flags. Cryptocurrencies are easily transferable and can be held in secret wallets; without strict oversight, a bad actor could siphon off coins or “lose” them (fall off the digital truck, as it were), and it would be incredibly difficult to trace them thereafter.
Unlike gold in Fort Knox—which Trump has compared this reserve to—Bitcoin and other cryptocurrencies can theoretically be moved with a few quick keystrokes, especially if stored in an un- or semi-secured fashion.
Trump’s plan so far lacks detail on who controls the reserve’s private keys or how transparency will be ensured.
Good governance advocates fear a scenario where political operatives manage billions in crypto with minimal accountability, creating opportunities for embezzlement or off-the-books transactions.
Hypothetical Abuse Scenarios of the Crypto Reserve
Given these concerns, here are a few ways a bad actor in Trump’s position (and with Trump’s history) might leverage a crypto reserve for corrupt ends:
Insider Trading & Market Manipulation: A president could secretly acquire certain coins before announcing they’ll be in the U.S. reserve, then sell after the price jumps. The Trump family’s last-minute crypto buys before his inauguration hint at exactly this kind of maneuver. By simply tweeting/“truthing” about adding a coin to the reserve, Trump or an associate could pump its value—an unparalleled power to move markets for personal gain.
Steering Investments to Allies: The reserve’s composition can reward friends and punish perceived enemies. Trump’s crypto czar, David Sacks, was previously an investor in Bitwise—a fund whose top holdings happen to be the same five coins Trump selected. Sacks claims to have liquidated these holdings before the announcement to avoid a conflict of interest, but this example gives us a sense of how Trump might choose assets specifically to enrich political allies or donors who hold large positions in those tokens in the future, creating a pay-to-play dynamic and turning public funds into a tool for private favoritism. Zooming out further, we might imagine how crypto projects around the world might airdrop or strategically donate coins in a bid to pump their value or curry favor.
Off-the-Books Financing: Cryptocurrencies could facilitate secret transactions. Through cryptocurrencies typically include a public ledger, there are still known methods for laundering funds (stolen or otherwise). A corrupt leader might route government-purchased crypto to unofficial projects or even personal wallets under the radar. Because crypto can be transferred pseudonymously, one could imagine coins from the “national reserve” ending up in a shell account to pay off cronies or even to solicit bribes from abroad. Trump has a history of off-the-record deals (for example, being accused of soliciting foreign election help in exchange for aid). With crypto, those quid-pro-quos could be greased with untraceable payments.
Evading Oversight: Traditional government funds are audited, but a crypto reserve operated outside the Federal Reserve system might not have the same scrutiny. If Trump hypothetically placed loyalists in charge, and neither the Supreme Court nor Congress stopped him, he could bypass institutional checks. Past behavior shows Trump often tried to subvert oversight—from ignoring Congress’s spending conditions to firing inspectors general. Handling billions in crypto through an ad-hoc working group could enable gross mismanagement or deliberate misuse without immediate detection.
Deflecting Accountability via Complexity: Crypto’s complexity can be an ally to corruption. If losses occur, a bad actor can fall back on plausibly deniable hacking, market volatility, or “technical errors.” For example, if coins “disappeared,” it might be written off as a cyberattack, conveniently masking an inside job. The inherent volatility also means if the reserve loses money, it’s hard to prove malfeasance versus market forces. This ambiguity could be exploited to cover corrupt acts (“Oh, the reserve’s value dropped this quarter—must be the bear market, not our fault…”). Mark Zandi of Moody’s Analytics warned that “turning the government into a hedge fund” with crypto is dangerous. By extension, it’s even more dangerous if those running that fund aren’t acting in good faith.
These scenarios underscore why commentators across the spectrum—from liberal economists to libertarian crypto investors—have expressed trepidation about Trump’s crypto reserve.
Systemic Issues: Political Corruption with Crypto
Trump’s plan highlights a broader issue: how cryptocurrencies enable new forms of political corruption. Even beyond this case, experts note several systemic risks when politicians embrace crypto:
Opaque Funding and Bribery: Cryptocurrency’s pseudo-anonymity makes it easier to hide political money. Bribes or illegal donations can be hard to trace on blockchain if laundered properly. A politician could receive funds in crypto that aren’t disclosed – there’s no bank record or simple paper trail, especially if using privacy coins or mixers. This is a global concern: the IMF has warned that inadequate crypto transparency “allows opportunities for corruption and bribery to persist.” In the U.S., campaign finance laws struggle to keep up with crypto contributions. Regulators fear that foreign actors could donate to campaigns via crypto wallets, skirting disclosure rules.
Unreported Wealth and Conflicts of Interest: Lawmakers and officials can hold crypto assets without declaring them, since disclosure requirements are evolving. This creates potential conflicts — a policymaker might push legislation to boost crypto prices while quietly holding a fortune in Bitcoin. We’ve already seen hints of this: nearly half of Congress members elected in 2024 were identified as “pro-crypto,” and many received significant campaign support from the crypto industry . If those officials are also investors, they have a personal stake in the policies they craft. For example, Senator Cynthia Lummis, a vocal crypto advocate, has openly owned Bitcoin (around $100k–$250k worth) while proposing bills to promote Bitcoin in government reserves. This doesn’t prove wrongdoing, but it creates an appearance problem: are they acting for the public or their own portfolio? Ethics watchdogs have started raising red flags. As WyoFile puts it: “Sen. Lummis has an undeniable financial conflict of interest” regarding her Bitcoin advocacy.
Industry Influence and “Pay to Play”: The booming crypto sector has poured money into politics, which can corrupt policy priorities. In fact, an estimated 48% of all corporate donations in the 2024 election cycle came from crypto firms, and crypto executives bankrolled super PACs to sway races. This flood of money buys clout. Trump’s own courting of crypto donors—and the subsequent policy payoffs—is a prime example. Another is the collapse of FTX in 2022: before its scandal, FTX’s CEO Sam Bankman-Fried famously donated tens of millions of dollars to politicians on both sides, aiming to shape crypto regulation. Such cases illustrate a risk of regulatory capture, in which industries effectively write the rules that govern them by bankrolling friendly officials. If a president (or any politician) is overly beholden to crypto benefactors, they might oppose sensible safeguards (like anti-fraud measures or investor protections) that the industry dislikes. Indeed, since Trump’s inauguration, his administration has rolled back oversight and even halted SEC lawsuits against major crypto players, moves cheered by his donors but worrying to consumer advocates.
Global Money Laundering Networks: Cryptocurrencies are already used by bad actors (e.g., hackers, sanctioned regimes, drug cartels) to launder money or evade laws. If politicians partake in the same channels, it blurs criminal and corrupt financial flows. The anonymity that can empower dissidents can equally empower corrupt officials to stash ill-gotten gains abroad in crypto wallets that regulators can’t easily freeze. This undermines anti-corruption frameworks worldwide. For instance, a corrupt leader can swiftly transfer a bribe into Bitcoin and store it in a “Swiss wallet” instead of a Swiss bank, out of reach of any authority.
Who is David Sacks? Trump’s “Artificial Intelligence and Crypto Czar”
A central figure in the crypto reserve is David Sacks, whom Trump appointed as his White House Artificial Intelligence and Crypto Czar. Sacks heads the Presidential Working Group on Digital Assets and chaired the White House’s crypto summit. Understanding Sacks’s background and associations helps illuminate the potential motives and influence behind the crypto reserve plan.
Who is David Sacks?
David Sacks is a prominent Silicon Valley venture capitalist and a member of the famed “PayPal Mafia,” the cohort of PayPal founders and early executives who went on to shape tech and finance (others include Peter Thiel and Elon Musk). Sacks was PayPal’s first COO, and later founded the enterprise social network Yammer (which he sold to Microsoft).
Sacks also co-founded Craft Ventures, a venture capital firm, and has invested in numerous tech startups, including crypto companies. Notably, Sacks has been a crypto evangelist for years. Back in 2017, he told CNBC that Bitcoin’s rise was revolutionizing finance.
He didn’t just talk the talk: Sacks personally held various coins like Bitcoin, Ethereum, and Solana, and his fund backed crypto projects. In fact, Sacks’s firm was an investor in Bitwise, a crypto index fund manager whose top holdings included the very five coins Trump selected for the reserve.
This connection raised eyebrows about conflict of interest. As criticism mounted, Sacks publicly clarified that he sold all his crypto holdings (BTC, ETH, SOL, et al.) before taking his government role, and even offloaded his stake in Bitwise in January 2025. He promised an ethics review to ensure no conflict. Despite that divestment, skeptics note that Sacks’s past advocacy of those coins and deep ties to the crypto industry mean his policy advice could be biased—intentionally or not—toward the sector’s interests.
Sacks’s Influence in Policy
Now in the White House, Sacks wields significant influence over U.S. crypto and tech policy. Colleagues describe him as savvy and deeply knowledgeable on crypto tech—“more technically and commercially competent [in crypto] than most would think,” according to one crypto asset manager. In addition to the crypto reserve, Sacks is expected to champion a pro-crypto, pro-innovation agenda , including a push for deregulation.
Sacks was a fierce critic of SEC Chairman Gary Gensler’s aggressive stance on crypto under the Biden administration. One of Trump’s first acts (presumably under Sacks’s counsel) was firing Gensler and installing crypto-friendly officials like Paul Atkins at the SEC. Sacks also supports initiatives like ending “Operation Chokepoint 2.0,” a supposed crackdown on crypto by regulators, and preventing the launch of a U.S. central bank digital currency—all promises Trump made to the crypto community.
The crypto industry has generally expressed enthusiasm about Sacks’s appointment. Even normally cautious figures welcomed the idea of Sacks at the helm of crypto policy as a sign the administration “will have a light touch on regulation, but not without some guardrails.”
But with influence comes scrutiny. Sacks has now found himself a target for criticism in the crypto reserve controversy. Some of Trump’s own tech supporters blame Sacks (and others in Trump’s team) for the decision to include risky altcoins. On social media, Joe Lonsdale, a fellow VC, blasted the reserve as “steal[ing] my money for crypto bro schemes,” reflecting anger that taxpayer funds could prop up niche tokens.
Sacks publicly rebutted Lonsdale, urging him not to jump to conclusions, insisting “nobody announced a tax or spending program” for the reserve. The later announcement of the Bitcoin reserve using seized crypto has supported this claim—at least for the moment.
Sacks’s Influence in Tech and Finance
Beyond crypto, Sacks’s broader influence in politics and finance is worth noting. He represents the growing bridge between tech money and government. Over the past few years, he’s funded political candidates and causes (from local school board races to backing Republicans who align with his free-market, anti-“woke” views). He was formerly a co-host of the popular All-In podcast, where he opined on policy and has shaped discourse among Silicon Valley leaders. All this means Sacks is far more than just a behind-the-scenes advisor—he’s a public intellectual of the tech right, and now an official with material power.
His presence in the Trump administration symbolizes the mainstreaming of crypto and tech mogul influence in Washington. Supporters see this as overdue modernization of government; critics worry it accelerates plutocratic tendencies, where billionaire investors set national policy to serve their interests.
How Trump Allies and the Crypto Community Responded to the Trump Crypto Reserve
Pro-Trump politicians are generally lining up behind the idea—or at least not publicly opposing it.
On the more MAGA end, some are framing the reserve as a way to bypass “woke bankers” and the Federal Reserve—tapping into a populist distrust of central banking. Trump’s own statements feed this narrative: he accused the previous administration of “corrupt attacks” on crypto, implying that this reserve is correcting a deep-state or elite bias against crypto.
That culture war framing—with crypto as part of the fight against the establishment—has made many in Trump’s base receptive to the idea, even if they don’t understand the technical details. On Truth Social and right-leaning forums, supporters cheer that Trump is “making crypto great again,” and some argue that this will help “end the Fed” or force a return to “sound” money, drawing an oft-touted but somewhat flawed parallel between Bitcoin and the gold standard.
Interestingly, the loudest criticism in social media has come not just from expected Trump critics, but from prominent pro-crypto voices who usually align with Trump.
On Twitter (now X), there was an eruption of debate among tech investors and crypto influencers. In addition to Lonsdale’s criticism mentioned above, Brian Armstrong, CEO of Coinbase and typically a champion of crypto adoption, argued that a reserve should “just [hold] Bitcoin… simplest, and [a] clear story as successor to gold.” He and others worry that throwing taxpayer money at volatile altcoins undermines the credibility of the idea. This encapsulated the libertarian critique—that government shouldn’t be picking winners in crypto or using public funds to “pump our crypto bags,” as another influencer, Vinny Lingham, put it. Tyler Winklevoss, one of the billionaire twins who founded the Gemini crypto exchange and who endorsed Trump in 2024 (for cinephiles: he was played by Armie Hammer in The Social Network), said that while he has “nothing against XRP, SOL, or ADA,” he doesn’t think they belong in a strategic reserve and that “only [Bitcoin] meets the bar” for that purpose.
Though some of these critiques have been tempered with the news of the bitcoin reserve and its handling, seeing these figures publicly critique Trump’s plan is noteworthy. These are people inclined to support crypto adoption, yet we can observe at least a degree of unease with how Trump is doing it. Their posts, often using phrases like “exit liquidity” (implying the government would be bailing out bag holders of those coins), were widely shared on X and even on emerging platforms like Bluesky.
Comparisons to Past Precedents
To understand how big of a deal the crypto reserve could be, it helps to situate the move in relation to past precedents, particularly with regard to past presidential precedents.
Trump’s approach to personal financial interest and governance—as exemplified by the crypto reserve—breaks sharply with modern presidential norms. Since the 1970s, U.S. presidents have generally taken pains to avoid even the appearance of financial impropriety while in office.
For instance, upon taking office in 1977, Jimmy Carter put his family peanut farm into a blind trust, specifically to ensure no one could “reasonably assert that [his] actions as President were motivated by a desire to foster [his] own personal gain.” In the decades after, presidents of both parties followed this tradition of divesting or entrusting their private assets. As the Associated Press noted, the practice “stretching back to Jimmy Carter in the late 1970s is for presidents to put personal holdings such as stocks into a ‘blind trust’ run by an independent trustee.”
Trump, by contrast, bucked this trend. When he took office in 2017, Trump refused to fully divest from the Trump Organization, a business empire spanning real estate, hotels, and branding deals.
Instead, he handed day-to-day control to his sons but retained ownership and the ability to withdraw profits. Ethics experts pointed out that this arrangement fell well short of a blind trust—Trump knew exactly what he owned and how policy decisions could affect his bottom line. Indeed, during his presidency, there were numerous instances that raised conflict-of-interest concerns: foreign governments and lobbyists spent lavishly at Trump hotels and resorts, effectively lining the President’s pockets while seeking favor.
A congressional report later found at least $7.8 million in such foreign payments during Trump’s term. Previous presidents had scrupulously avoided such situations (for example, by selling off businesses or placing assets in true blind trusts). Trump’s attitude was different—he famously said the president “can’t have a conflict of interest” and brushed aside calls to separate his personal financial interests.
In light of this, the crypto reserve looks like an extension of Trump’s norm-breaking approach. No past president attempted to direct federal investments in a way that so directly mirrors his own portfolio or his donors’ wish lists. It’s hard to find an exact historical precedent. The closest analogies are more indirect.
Under Ulysses S. Grant (1869–77), for example, there were scandals where associates tried to corner markets (like the Gold Ring scandal of 1869) by influencing government actions—but Grant himself wasn’t trying to enrich a family business, and the scandal erupted when he actually intervened to stop the manipulation.
Another example often cited is Warren Harding’s Teapot Dome scandal in the 1920s, where officials took bribes to lease federal oil reserves to private companies. That was clear-cut corruption, but importantly, President Harding didn’t orchestrate it for personal gain (it was his Interior Secretary taking bribes). In Trump’s case, the concern is that the president himself is effectively arranging a “deal” that mixes public resources and personal interest in an unprecedented way.
Even during Trump’s first term, critics noted a blurring of personal and public interests, such as administration policies that happened to favor Trump’s business or friends. But those were usually subtle or hard to prove (for instance, did foreign policy decisions curry favor with regimes that later granted Trump Organization trademarks or projects? It was debated).
The crypto reserve, however, is unusually overt: it literally uses government funds to buy specific private-sector assets. Imagine if a past president had said, “We’re going to use taxpayer money to buy shares of five companies—selected by me.” It would have been a scandal. Yet Trump is essentially doing the crypto equivalent, naming five privately created coins to purchase, some of which are effectively companies or projects led by people close to his circle.
One coin, XRP, is directly tied to a company (Ripple Labs) that is facing an SEC lawsuit. The optics of the U.S. government loading up on an asset that a private firm (led by political supporters) was pushing for adoption are troubling to many observers of government ethics.
That’s all for now! But the story is obviously still developing, so I’ll be updating this page and producing more analysis over the days and weeks to come. As I mentioned above, this post is available as a free post for a brief window before entering the paid archive. To make sure the original version hits your inbox (giving you access to it in perpetuity), be sure to subscribe for free now:
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Want a change of pace after all that? Check out this interview I did with mycologist Danielle Stevenson on the Urgent Futures podcast, where we talked about using fungi and other organisms to heal toxic sites, such as those impacted by the Los Angeles wildfires:
