China to Launch Bitcoin Reserve? These Altcoins Could Soar as The Nation Plans to Lift Crypto Ban

According to Bo Hines, the executive director of the Presidential Council of Advisers on Digital Assets, the Trump administration could consider using tariff revenues to build a national Bitcoin reserve.

It marks a notable shift, given recent indications that revenue generated from gold sales would help fund the Bitcoin reserve.

Trump Tariff Revenues To Fund US Bitcoin Reserve

Bo Hines explained the possibility during recent interviews. He cited the need for the US to act swiftly amid global competition for Bitcoin accumulation.

Speaking to Thinking Crypto on Tuesday, Hines emphasized that the US must compete globally in Bitcoin. He highlighted the creation of a Strategic Bitcoin Reserve (SBR) through budget-neutral means. This, he said, includes novel funding mechanisms such as tariff revenues.

“SBR recognizes the value of what Bitcoin is and how it can be harnessed for the American people. There is a finite number of Bitcoin and I think there will end up being a race to accumulate,” Hines stated.

He reiterated this in an interview with Anthony Pompliano, the founder and CEO of Professional Capital Management. Bo Hines discussed the re-evaluation of tariffs, Bitcoin, and gold during the discussion. He labeled them as key components of the administration’s macroeconomic strategy.

“The strategic reserve is just the beginning. We’re thinking long-term about what assets can empower the American people and insulate us from global shocks,” Hines told Pompliano.

This plan is different from what Republican Senator Cynthia Lummis of Wyoming proposed. BeInCrypto reported that she introduced legislation to increase the government’s Bitcoin holdings by selling a portion of the Federal Reserve’s gold. 

“We will convert excess reserves at our 12 Federal Reserve banks into bitcoin over five years. We have the money now,” said Senator Lummis back in July at the Bitcoin 2024 Conference.

The notion of using tariff revenue to buy Bitcoin is novel. However, such a move could redefine the role of digital assets in the US economic strategy. It reflects a broader ideological pivot, treating digital assets as more than speculative instruments but as national economic tools.

Crypto advocates responded enthusiastically. Influencer Crypto Rover called the tariff-based Bitcoin acquisition plan “mega bullish,” reflecting wider market sentiment.  

However, some experts caution that the policy may backfire. Charles Hoskinson, founder of Cardano, questioned the effectiveness of tariffs, warning that future government-imposed taxes on crypto will be ineffective.

Meanwhile, others warn that Trump’s aggressive tariff stance could undermine US Bitcoin mining dominance. Hardware costs and international trade barriers could harm domestic miners, especially if Chinese-made mining equipment is further taxed or restricted.

Despite these complexities, the administration appears undeterred. Hines also hinted at integrating stablecoin legislation and blockchain technology within banking infrastructure. He said this would bolster law enforcement capabilities in crypto and signal a multi-pronged strategy.

Hines’ comments come amid broader financial shifts. Reports suggest the Trump administration is considering replacing Federal Reserve Chair Jerome Powell.

As inflation pressures mount and trade tensions with China escalate, speculation is that a more crypto-friendly Fed chair could align monetary policy with the administration’s digital asset goals.

With geopolitical tensions rising and central banks racing to define their digital currency strategies, the US appears to be moving toward a more assertive position.

BeInCrypto data shows Bitcoin was trading for $85,465 as of this writing. This represents a modest 1.09% surge in the last 24 hours.

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A senior official from Russia’s Finance Ministry has called for the development of stablecoins linked to foreign currencies after wallets connected to Russian users and holding USDT were frozen last month.

The move comes as US-backed stablecoins dominate global liquidity and Washington moves closer to introducing new regulations for the sector. 

Russia Might Enter the Stablecoin Market

The ongoing pro-regulatory shift is drawing in new projects targeting the US market. Russia, facing growing financial restrictions, sees a digital alternative as increasingly necessary.

For Russia, this would be the perfect time to enter the stablecoin competition. Due to the US’ ongoing tariffs and worsening trade relations with China, the USD faces global pressure. Heavily tariffed countries are already considering de-dollarization.

A ruble-backed token could reduce the region’s reliance on USDT and USDC, which both track the US dollar. Such a shift would support Russia’s long-term effort to move away from dollar-based trade.

Elvira Nabiullina, head of Russia’s central bank, remains against using crypto for domestic payments. However, she confirmed that several Russian firms are testing international crypto transfers as part of a government-led trial.

Russia has explored stablecoin initiatives before. In 2023, its central bank reportedly discussed a gold-backed digital currency with Iran, intended for cross-border use and positioned as an alternative to the dollar. 

As BeInCrypto previously reported, Russian businesses are already using Bitcoin and other cryptocurrencies for international transactions.

The urgency of Russia’s stablecoin push increased after Tether blocked wallets on the Garantex exchange, freezing assets worth more than 2.5 billion rubles ($30 million). The incident occurred shortly after Garantex was hit with European Union sanctions.

At the same time, Kyrgyzstan is making moves of its own. The country has announced plans to build a crypto hub, supported by Binance founder Changpeng Zhao. 

A central part of the initiative is A7A5, a stablecoin tied to the ruble that aims to serve emerging markets.

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