Bitcoin In The Mix? Trump’s Executive Order Sets Up Sovereign Wealth Fund

In a move that could significantly impact Bitcoin (BTC) and the broader crypto landscape, President Donald Trump signed an executive order on Monday establishing plans for a government-run sovereign wealth fund aimed at economic development. 

This initiative follows Trump’s ongoing commitment to leverage Bitcoin and digital assets as a tool for the country’s economic strategy, a promise he made during his campaign last year.

Could Bitcoin Find A Place In US Financial Assets?

US Treasury Secretary Scott Bessent indicated during a press briefing that the administration intends to “monetize the asset side of the US balance sheet for the American people” within the next year. 

Bessent elaborated that the fund would encompass a range of liquid assets and domestic resources, signaling a potential shift in how the US manages its financial assets.

While the executive order does not specifically mention Bitcoin or cryptocurrencies, its goals include promoting fiscal sustainability, reducing tax burdens for American families and small businesses, and enhancing the country’s economic and strategic influence globally. 

The fund is also expected to invest in critical infrastructure projects such as airports and highways, which could bolster US influence in strategic regions like Panama and Greenland.

Bessent, alongside Commerce Secretary nominee Howard Lutnick—an advocate for Bitcoin and cryptocurrency—will develop a strategy for the fund within 90 days of the order. 

Pending further details, this move could potentially align with a growing trend among sovereign wealth funds to explore Bitcoin and digital assets as part of their investment strategies.

A Model For US Investment Strategies

Norway’s sovereign wealth fund, the largest in the world with over $1.7 trillion in assets, serves as a notable example. According to the Sovereign Wealth Fund Institute, the Norges Bank Investment Management (NBIM) has seen its indirect Bitcoin exposure rise by 153% in 2024. 

This increase, from 1,507 BTC at the end of 2023 to 3,821 BTC by the close of 2024, reflects a broader acceptance of Bitcoin in institutional investment strategies, even if not pursued directly.

Crypto expert Vetle Lunde emphasized that this rising exposure to Bitcoin among major institutional players indicates its maturation as a critical component of investment portfolios. 

Lunde also highlighted that NBIM has expanded its investments in Bitcoin-related companies, including mining firm Riot Platforms and the Japanese entity Metaplanet, while maintaining significant stakes in MicroStrategy, despite earlier predictions of reduced exposure.

The potential for a similar approach from Trump’s administration suggests a strategic pivot towards integrating Bitcoin and other digital assets into the US economic framework. 

Analysts like Lark Davis have noted the substantial implications of this executive order, suggesting it could enable the sovereign wealth fund to invest in stocks, cryptocurrencies, marking a transformative moment for the market.

As the administration prepares to unveil more details, the role of the newly appointed White House Crypto Czar will be closely monitored, especially during his upcoming Tuesday conference. 

Featured image from DALL-E, chart from TradingView.com