A month ago, the crypto community latched onto headlines from Arkham Intelligence and kickstarted a misleading news cycle that lasted the entire month of July. Thanks to purposefully ambiguous terms and play-by-play commentary about movements of bitcoin associated with governmental agencies, there are countless people who believe that governments around the world have been buying bitcoin, holding it as a reserve asset, and timing their purchases and sales to maximize gains.

It never happened.

On July 6, Arkham published an easy-to-read dashboard of ostensible bitcoin holdings by four governments: US, UK, Germany and El Salvador. Many people misinterpreted ‘holdings’ as ‘reserves’ or ‘investments.’ Blog posts, articles, and social posts proliferated under the mistaken understanding that governments were buying bitcoin, deciding on dates and times to buy and sell, and otherwise jockeying with other sovereigns to acquire bitcoin as a strategic reserve asset.

Only one government — El Salvador — has been buying bitcoin with public funds for investment or reserve asset purposes.

Seized proceed of crime, not reserve asset

All other governmental holdings of bitcoin are not held as reserves, nor did those governments buy those coins using public funds. Instead, they are almost exclusively seized assets from criminals with courts authorizing their temporary custody.

For example, the US government has held bitcoin seized from James Zhong, Ryan Farace, Konrads Voits, Darcy Wedd, and dozens of other criminals. US courts have authorized the US Marshals and other temporary custodians like Anchorage Digital to hold those bitcoin as proceeds of crime until they are lawfully disbursed, auctioned, liquidated, or transferred.

Emboldened by an avalanche of social media support for governments buying and holding more bitcoin — even though only one government actually buys and holds bitcoin — lobbyists began writing letters to influence supposed trading policies governing these governments’ bitcoin. For example, UK lobbyists wrote a letter asking a chancellor to not sell 61,000 government-controlled bitcoin.

Of course, that chancellor has no authority to refrain from selling those bitcoins, which are mostly seized proceeds of crime.

Mistaken believers continued to track Arkham’s dashboard of government holdings, pleading with lobbyists and regulators to buy more bitcoin or refrain from selling.

Read more: Bitcoin Lightning dev tried to outsmart Secret Service at Trump speech

Applause for Donald Trump’s fake bitcoin reserve

Media coverage hit its zenith last week at the world’s largest gathering of Bitcoiners at Nashville’s Music City Center convention hall. The keynote speaker headlining the conference was Donald Trump.

Punctuated by a string of words that ended in a purposeful substitution of the word ‘reserve’ for ‘stockpile’ that flew over the heads of his applauding audience, Donald Trump’s speech on July 27 marked the peak in this news cycle about non-existent governmental bitcoin reserves.

Trump promised to ‘take steps’ to transform ‘vast wealth’ held by the US government into a ‘strategic national bitcoin stockpile.’ He never promised to buy any bitcoin with public funds, nor did he promise to change any rule governing the US Marshals, bankruptcy custodians, or other court-approved holders of bitcoin.

In the end, he promised no measurable change to existing policies governing the US government’s bitcoin holdings. As before, US government agencies temporarily hold the proceeds of crime as they await court orders to liquidate or disburse that bitcoin to victims or public funds. Those policies will simply continue.

In his signature, meandering speaking style, Trump made this non-promise from the stage of the Bitcoin 2024 conference.

No bitcoin reserve exists

He has not promised to add bitcoin to a national strategic reserve, because ‘strategic reserve’ is a controlled term with specific meaning. The US has true reserves of oil, gold, grain, foreign currencies, machinery, and other critical assets for use in times of crisis.

The US also has a ‘strategic national stockpile,’ which is also a controlled term that defines a set of federal warehouses containing medical supplies — not financial assets held by governments for speculative or reserve purposes.

Because Trump’s scriptwriters were aware that he doesn’t have the authority to promise to add bitcoin to any strategic reserve nor the pharmaceutical national stockpile, he simply promised to “keep 100% of all the bitcoin the US government currently holds or acquires.” That changes nothing. The US government already holds 100% of the bitcoin it acquires unless a court authorizes disbursement, auction, liquidation, or transfer.

Even as president, Trump would never have the authority to prevent US courts from ordering disbursement of seized bitcoin to victims or public funds, and so, he has promised no change whatsoever.

Of course, media publications feverishly covered Trump’s commentary on US government bitcoin holdings as a breaking news event. The supposed news topped the opening sentence of the conference organizer’s official recap.

Governments have not been buying billions of dollars of BTC

As with the entire news cycle about governments buying billions of dollars worth of bitcoin, it simply never happened.

The US government, like over 190 countries, does not have a strategic bitcoin reserve or stockpile. A few governments hold bitcoin that has been seized from criminals and is holding that bitcoin pending court instructions. One government, El Salvador, buys bitcoin using public funds.