The latest U.S. proposal to establish a strategic Bitcoin reserve has shifted away from mandatory purchases toward a long-term custody model, limiting its immediate market impact while laying groundwork for future policy expansion.
A shift from buying to holding
The American Retirement and Monetary Advancement Act (ARMA) would prohibit the federal government from selling its Bitcoin holdings for 20 years, without requiring any new acquisitions. The reserve, currently estimated at more than 320,000 BTC and built entirely from seized assets, would be consolidated under Treasury management.
This marks a clear departure from earlier legislative efforts that aimed to make the U.S. an active buyer of Bitcoin. Previous versions, including the 2024 BITCOIN Act, proposed purchasing up to one million BTC over five years using Federal Reserve surplus funds. Those plans failed to advance due to fiscal concerns and fears of destabilizing the dollar’s global role.
Under ARMA, any future acquisition strategy would first require a feasibility study within 180 days, focused on budget-neutral methods rather than direct market purchases.
Reduced downside risk, limited demand boost
Because ARMA does not mandate buying, its direct effect on Bitcoin demand is expected to be minimal. Instead, the bill primarily removes the risk of large-scale government liquidations, which have historically weighed on market sentiment.
This dynamic was evident in March 2025, when an executive order pledged not to sell federal Bitcoin holdings but excluded purchase commitments. Bitcoin’s price fell 5.7% following the announcement, reflecting disappointment among traders who had hoped for government-led accumulation.
If passed, ARMA would formalize that executive order into law, giving Bitcoin an explicit designation as a U.S. reserve asset and legally protecting existing holdings from sale for two decades, except in cases such as debt repayment.
Political viability improves
The revised approach has gained broader political backing by avoiding new spending obligations. Treasury Secretary Bessent and other lawmakers previously opposed compulsory purchases, citing cost and volatility concerns. With those provisions removed, ARMA now has a higher likelihood of progressing through Congress.
The bill was introduced in May 2026 by Representative Begich, with Representative Golden as a co-sponsor, and reflects an incremental strategy: first codify custody, then revisit acquisition at a later stage.
Market context remains fragile
The legislative shift comes during a period of heightened uncertainty in the cryptocurrency market. Sentiment indicators have recently pointed to extreme fear, while Bitcoin has experienced sharp volatility, testing levels near $61,000 before attempting a recovery.
Traders have also been watching significant outflows from spot Bitcoin ETFs, which have exceeded $4 billion in recent sessions. At the same time, on-chain data suggests long-term holders are accumulating, absorbing supply from newer market participants.
The market value to realized value ratio currently stands around 1.15, indicating the average holder remains modestly in profit. Historically, stronger bull cycles have pushed this metric above 3, leaving room for further upside if momentum returns.
What comes next
Near-term price direction is likely to hinge on macroeconomic signals, particularly the Federal Reserve’s policy outlook. Market participants are closely monitoring the central bank’s stance, which could determine whether Bitcoin breaks below key support levels or regains higher ground.
Meanwhile, corporate treasury activity continues to serve as a gauge of institutional conviction. Recent purchases by major holders suggest ongoing interest despite subdued sentiment.
In its current form, ARMA does not position the U.S. as an immediate buyer of Bitcoin, but it does establish a formal legal foundation for holding it as a reserve asset. While that may not drive prices in the short term, it signals a gradual shift in how policymakers approach digital assets, with potential implications that extend well beyond the current market cycle.
To understand broader implications of a U.S. Bitcoin reserve, explore our insights in this detailed analysis.
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