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Trump wants government to hold on to seized crypto assets

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Trump: "We don't want any cost to the taxpayers"

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Industry leaders seek clarity on crypto regulation and

scrutiny

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Concerns over Trump's crypto interests and conflict of

interest

(Updates throughout with Trump comments at event)

By Nandita Bose, Suzanne McGee and Michelle Conlin

March 7 (Reuters) - U.S. President Donald Trump wooed

the cryptocurrency industry's elite at the White House on

Friday, hosting a first-of-its-kind summit focused on his plans

for a government-owned stockpile of digital assets.

Trump welcomed a wide range of industry players

including Zach Witkoff, one of the founders of the president's

own crypto business, World Liberty Financial, his social media

posts showed.

In addition to top administration officials and

lawmakers, guests in the White House's State Dining Room

included MicroStrategy ( MSTR ) CEO Michael Saylor, Coinbase

co-founder and CEO Brian Armstrong, investors Cameron and Tyler

Winklevoss, and entrepreneur David Bailey.

A major focus of the event was Trump's goal to build a

strategic reserve containing bitcoin, which he formalized in an

executive order on Thursday that also said there would be a

stockpile of other digital assets.

That order directed the secretaries of Treasury and

Commerce to develop "budget-neutral strategies" for acquiring

additional bitcoin that have no "incremental costs" on

taxpayers.

"We don't want any cost to the taxpayers," Trump said at

the summit.

The reserve will be capitalized with bitcoin owned by

the federal government that was forfeited as part of criminal or

civil asset forfeiture proceedings, White House crypto czar

David Sacks said in a post on social media platform X.

Sacks told reporters at the White House that

establishing a bitcoin reserve should have been done a long time

ago. He said taxpayer funds would not be used to acquire digital

assets and that there were existing protections in place to

safeguard consumers from crypto investments.

The plans disappointed some in the market who had hoped

for a firm plan to buy new tokens. The announcement weighed on

the price of bitcoin, last down 3.4% at $86,394.

"This (strategic reserve) is going to be the biggest

point of contention for many of us," said JP Richardson,

co-founder and CEO of Exodus, a bitcoin wallet

developer. Although he owns the four coins other than bitcoin

that Trump has suggested including in the reserve, he does not

think they have a place in a strategic reserve.

"Crypto has made big strides, but it's still a relatively

nascent industry," Richardson said. Other coins are smaller and

function in a very different way, one he said may create more

risk.

Officials invited to the summit praised Trump and

executives for clearing the way for the industry's growth. Other

industry executives said it was good to see the administration

being collaborative with the industry after years in which some

felt they were under attack over security and consumer

protection issues.

"For the first time, industry leaders feel they're

walking into a collaborative discussion," said Les Borsai,

co-founder of Wave Digital Assets, a crypto investment adviser,

who said he did not receive an invitation.

Trump was upbeat about the crypto industry's prospects,

telling the summit, "We feel like pioneers in a way."

He added: "From this day on, America will follow the

rule that every bitcoin knows very well, never sell your

bitcoin. That's a little phrase that they have. I don't know if

that's right or not. Who the hell knows, right? Who knows? Who

knows, but so far, it's been right, and well, let's keep it that

way."

Trump's executive order spells out that the government's

own bitcoin holdings should never be sold.

Treasury Secretary Scott Bessent told the event the U.S. was

going to keep the dollar as the world's reserve currency and use

stablecoins to do that.

In a post on X, Brad Garlinghouse, CEO of technology

company Ripple, who attended the summit, said he welcomed

Trump's recognition that the world of cryptocurrencies stretched

beyond bitcoin. XRP, the coin tied to Ripple, is one of the four

other cryptocurrencies Trump has suggested may be added to a

crypto reserve.

Attendees said they were optimistic about working with an

administration that views crypto as a mainstream asset class and

expressed hope for a straightforward regulatory process.

"What everyone really needs to have at this point is clarity

on what the level of scrutiny and intensity of regulation will

be, who the key regulators will be," said Yesha Yadav, associate

dean and professor of law at Vanderbilt University.

That could speed up the process of approval by the

Securities and Exchange Commission of a flurry of new listings

of exchange-traded funds.

Trump's family has launched cryptocurrency meme coins and he

also holds a stake in World Liberty Financial, a crypto

platform, which has sparked some conflict-of-interest concerns.

His aides have said Trump has handed over control of his

business ventures, which are being reviewed by outside ethics

lawyers. The White House did not respond to a request for

comment.