Everything you need to know about crypto reserves

There’s been lots of talk at the start of 2025 around crypto reserves. This blog looks at some of the most important questions and consequences of crypto reserves and where they sit in the digital assets landscape. 
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What is a crypto reserve?

A crypto reserve, also known as a crypto strategic reserve, is a stockpile of cryptocurrencies held by a government or institution. It functions similarly to traditional reserves of gold, foreign currencies, energy sources, or commodities such as oil and food. Strategic reserves are created not just by government entities, there are also strategic reserves for large-scale organizations and businesses for anything and everything, such as the Svalbard Global Seed Vault, maintaining a strategic reserve of agricultural seed samples, or the International Strategic Reserve of the Federation of Quebec Maple Syrup Producers. 

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What are the key features of a crypto reserve?

A crypto reserve is made up of major cryptocurrencies - most commonly Bitcoin. Some reserves are solely made of Bitcoin, others may have a diverse, multi-asset reserve. Crypto reserves can be managed by dedicated agencies or by central banks, similar to Federal Reserves managing traditional reserves. This is different if the reserve is for a private entity. 

One of the key features of a crypto reserve is safety protocols, as they require robust custody solutions and decentralized vault systems managed extremely carefully. Who they are managed by and how is a vital discussion in the creation of a crypto reserve.

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Who is creating strategic crypto reserves?

El Salvador is seen as a pioneer in creating national strategic crypto reserves. This follows the country’s adoption of Bitcoin as a legal tender in 2021, and their crypto reserve stands at 5,944 Bitcoin (around $560 million). Similarly, the kingdom of Bhutan has a crypto reserve value of$1.2 billion, and China is also a known large holder of cryptocurrencies. In the EU, Czechia’s national bank is currently exploring a Bitcoin reserve plan but has slowed down plans after backlash, and the commissioned study will now take longer to be published. 

The United States is currently investigating the plausibility of a strategic Bitcoin reserve, however, it will not be the first time that crypto reserves have been investigated in the country. A number of states have already been looking into the opportunity: Ohio introduced a bill right at the beginning of 2025. In total, sixteen states are already considering similar legislation.

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Why is everyone talking about crypto reserves?

Crypto reserves are on the tip of everyone’s tongue because of this sudden surge of interest from the United States of America. President Trump made a lot of campaign promises in the lead-up to the election about creating a strategic crypto reserve, which likely fuelled the moves by certain states to get ahead of the game. However, since taking office President Trump’s mood on immediately creating a crypto strategic reserve has been fairly cool, and even disappointing to some. Instead, he signed an executive order to start a study and a working group on the idea, which some see as one of many nods from the President to the crypto industry during his term. 

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Challenges and benefits of crypto reserves

Some of the challenges for any entity looking to create a crypto reserve include…

• Regulations. Regulatory clarity is essential for an effective crypto reserve. 
• Energy requirements. Bitcoin and crypto are large energy consumers. Not only does this lead to the environmental consequences of using fossil fuels and the tricky question of waste, but also energy dependency that can cause geopolitical issues. 
• Security. Ensuring the safety of crypto reserves is a complicated and expensive task, with a lot of risks involved. 

The benefits behind these strategic crypto reserves are…

• Diversification of assets and other strategic reserves. 
• Transparency. Blockchain technology allows for public verification of reserves. 
• Hedge against inflation. 
• Reduced dependency on traditional assets. 
• High return potential. Bitcoin and other cryptocurrencies are volatile, but they can have impressive long-term returns. 

Reserves in 2025

We will likely see a significant rise in the discussion around, and the creation of, strategic crypto reserves in 2025. Crypto reserves are not a new idea, but as more governments and organizations look into the strategy it may begin to shape economies in a significantly more impactful way.