Written by Stefanie Wayco, Matthew Catani Translated by: Vernacular Blockchain

1. Trump's

1) Trump is moving towards crypto-friendly

U.S. President Donald Trump is gradually pushing for the establishment of a crypto-enabled one. One clear signal is that he appointed David Sacks as the White House commissioner for artificial intelligence and cryptocurrency.

This appointment has sparked widespread speculation: how exactly will the so-called "cryptocurrency specialist" work? Does this position have real power to formulate? Will it drive a clearer regulatory framework? Is Sacks just a consultant and not a formal position and authority? Will this role lead to a new level of crypto-asset reserve mechanism that enables holding and protecting digital assets?

2) Level cryptocurrency reserves: promoting the integration of regulation and blockchain technology

If the United States supports the establishment of an official cryptocurrency reserve library, this may bring much-needed clarity to the current digital asset field, such as clarifying which agency regulates cryptocurrencies. This will not only help promote the full integration of cryptocurrencies in daily payments and investments, but will also promote the application of blockchain technology in large-scale projects.

As the most widely recognized digital asset, Bitcoin has long been regarded as the industry standard, and Trump has also publicly supported calls for building strategic Bitcoin reserves. Under the new leadership, the United States has the opportunity to lead a wave of innovation and change, opening a new era with digital credit and global acceptance at its core - not only Bitcoin, but also the entire cryptocurrency ecosystem, whether they are defined as securities or commodities.

2. Digital Asset Diplomacy: How the Fed uses cryptocurrency

1) The role of the Fed

The Fed, as the central bank of the United States, is responsible for managing currency, controlling inflation, regulating financial institutions, ensuring the efficient operation of payment systems, and safeguarding consumer rightsbeneficial.

The central characteristic of the Fed is its independence, which allows it to focus on long-term economic stability. At the same time, it also needs to work closely with other federal agencies, such as the Treasury, the U.S. Securities and Exchange Commission, and the Federal Deposit Insurance Corporation (FDIC) to provide comprehensive regulatory and financial stability.

For example, the Federal Reserve and the Treasury cooperate to manage debt issuance and bond market liquidity, jointly maintain the stability of the financial market with the SEC, and cooperate with the FDIC to ensure deposit security and maintain the integrity of the banking system. To achieve these goals, the Fed uses a variety of tools, including adjusting interest rates to affect borrowing costs, buying and selling Treasury bonds through open market operations to regulate market liquidity, and setting deposit reserve requirements to ensure that banks maintain sufficient liquidity.

In addition, the Federal Reserve is responsible for overseeing the core parts of the payment and settlement system, including electronic payment processing and money supply management. In the future, whether the Fed will further enter the cryptocurrency field and become a part of US finance is still worth paying attention to.

2) Vision of cryptocurrency reserves

Trump's cryptocurrency reserve plan—whether to enhance financial stability, suppress inflation, manage debt, or promote innovation—requires strategic collaboration, and the Fed is undoubtedly the most suitable institution to lead this process.

Just like its role in traditional asset management, if the Fed can participate in the management of cryptocurrency reserves, it will not only ensure that the plan meets overall fiscal and monetary goals, but also directly affect its success or failure.

In addition, the new admission of cryptocurrencies also reflects its confidence in the Federal Reserve's ability to effectively manage cryptocurrency reserves.

Level cryptocurrency reserves can be regarded as strategic financial instruments similar to traditional reserve assets such as gold. Supporters believe that building cryptocurrency reserves will help reduce debt, release more liquidity in the U.S. dollar, and establish cryptocurrencies as long-term financial assets.

Whether crypto assets are classified as securities, commodities or currencies, such reserve mechanisms may become market stability factors and increaseStrengthen the credit and credibility of cryptocurrencies and enhance their position in the financial system.

3. Cryptocurrency: New commodities and "digital gold" standards

1) Historical background and standards of the financial system

Financial standards play a crucial role in economic stability and consumer trust. Historically, the gold standard has provided a fixed framework for monetary value that anchors the value of money to a specific amount of gold.

Under the gold standard system, the currency can be exchanged for gold at a fixed exchange rate, which provides stability and predictability for financial markets and international trade. Central banks maintain fiscal discipline by holding gold reserves and limiting the money supply to match the size of the gold reserves.

Now, the United States guarantees all kinds of securities through a "full faith and credit system), and can ensure the reliability of its assets even without physical support. This principle refers to the unconditional guarantee of fulfilling its debts, thereby enhancing market confidence in issuing securities.

For investors, credit guarantees make investment vehicles such as U.S. Treasury bonds safer and more reliable, because these debts rely on taxation rights or currency issuance capabilities, providing the market with a stable credit system. From a perspective, the credit system enables efficient fundraising through debt financing to support key projects such as infrastructure construction and emergency rescue plans. At the same time, it is also the cornerstone of trust in the broader financial system, supporting various capabilities to promote economic growth and risk resistance. If cryptocurrencies can gain more formal recognition under this framework, they may become a new strategic reserve asset after gold and bonds, and even push the global financial system into the era of "digital gold".

2) Crypto Plan: Going to a clear regulatory framework

Wyoming Senator Cynthia Lummis has been advocating for the establishment of Bitcoin reserves, and her plan envisions accumulating 1 million Bitcoins over 20 years to hedge inflation and serve as a supplementary asset to the dollar.

The proposal includes converting the Fed's gold vouchers into Bitcoin and establishing a strategic reserve that requires holding for at least 20 years.

The future cryptocurrency regulatory framework must address the following key issues:

Property and ownership protection

Security custody solutions

Which agency regulates cryptocurrencies

When and how to base the SECv of the 1946 U.S. Supreme Court. The Howey case determines it as a securities and whether it should be classified as a commodity

The Cryptocurrency Regulation Act proposed by Rumis is intended to solve these regulatory challenges and clearly distinguish securities from commodities to simplify the compliance process for cryptocurrency companies. The bill also designs a specific funding support mechanism and regulatory framework, which plans to transfer the regulatory power of some crypto assets from the U.S. Securities and Exchange Commission (SEC) to the Commodity Futures Trading Commission (CFTC).

With the rapid development of the cryptocurrency market, courts face challenges in determining whether certain digital assets belong to securities or commodities. There are still many blurred areas in the current legal standards, and the industry is difficult to follow unified regulatory standards. Therefore, a clearer and comprehensive regulatory framework is crucial.

Howey tests are still applicable, but this law enacted in 1946 can no longer fully apply to cryptocurrencies. After all, the courts at that time could not foresee the emergence of digital assets.

While digital assets themselves are not equivalent to securities, if the new generation strives to promote the development of the crypto industry and embraces cryptocurrency reserves, it may become a reality to establish a new regulatory framework to clarify the boundaries between securities and commodities.

3) Strategic oil reserve model: References to cryptocurrency reserves

3) Strategic oil reserve model: References to cryptocurrency reserves

The U.S. Department of Energy (DOE) demonstrates how maintaining commodity reserves affects the market by managing strategic oil reserves (SPR).

Although strategic oil reserves are mainly aimed at the energy industry and indirectly affecting the majority of consumers, unlike the cryptocurrency industry, it can still serve as a basic model for building cryptocurrency reserves.

The core functions of strategic oil reserves include: Stabilizing oil prices, preventing violent market fluctuations

Make up the fiscal deficit, providing fiscal leverage

Enhance the influence of global markets, and providing strategic advantages in international energy games

Similar to the role of SPR in energy markets and inflation regulation, cryptocurrency reserves can also affect the digital asset market and even become monetary tools.

In the SPR's management mechanism, the DOE is responsible for daily operations, but the President has the right to order the use of reserves, and Congress can also authorize the sale of SPR crude oil to support expenditures or respond to emergencies, such as regular sales required by legislation to adjust reserve levels. Therefore, strategic oil reserves not only affect finance and currency, but also have a direct impact on energy markets, commodity prices and inflation expectations. Similarly, cryptocurrency reserves can:

stabilize the crypto market, reduce price volatility

held economic instability, provide financial hedging tools

influence global cryptocurrency adoption, enhance the US dominance in the digital asset market

how Congress authorizes SPR funds to be used for projects, cryptocurrency reserves may also determine how they are used through legislation in the future.

4. Bitcoin Reserve: The Fed's new role

If a level of Bitcoin reserve is established, the Fed will play a similar SPR in the crypto marketRole in the energy market, and the CFTC (Commodity Futures Trading Commission) can assume regulatory functions similar to DOE, responsible for the execution and supervision of cryptocurrency reserves. Under this model, the Fed can not only:

strategically formulate cryptocurrency-related

manage and stabilize crypto assets held in a stable manner

ensure sufficient reserve assets to cope with fiscal demand and generate returns

protect investors' interests and ensure market stability

in addition, the Fed will retain its core functions, including:

Set interest rates to affect market liquidity

Borrowing and financing, promoting projects

Use cryptocurrencies as collateral assets to enhance fiscal flexibility

The bill proposed by Lummis also emphasizes that the U.S. Treasury will play a key role in managing and protecting Bitcoin reserves, just as its current cooperation model with the Federal Reserve.

1) The future of decentralized cryptographic reserves

In order to improve transparency and security, decentralized vault systems may be used as storage solutions for encrypted reserves. The Ministry of Finance can: manage and regulate the custody of crypto assets, ensure the security of reserves

establish a custody mechanism that meets regulatory standards to avoid the abuse of assets

Ensure that reserves are open and transparent, and conform to the market's trust mechanism in asset management

This mechanism not only solves the problems of ownership and custody, but also enhances the public's confidence in cryptocurrencies and promotes the whole society to "full fa" in cryptocurrencies.ith in crypto)” approval.

2) The concept of cryptocurrency reserves at level: efficiency, innovation and development, demonstrates a vision to reshape the US economy - it combines traditional financial principles with emerging digital technologies to promote the transformation of the financial system to modernization. However, the evolution of cryptocurrencies marks an important turning point, with its gradual transition from Bitcoin’s initial decentralized vision to a more regulated, dominant model.

The core challenge lies in how to balance the historical concept of decentralization while ensuring that users can use, invest and innovate digital assets efficiently and safely.

Even though the industry still emphasizes decentralization, its development has reached a stage where supervision is urgently needed. Faced with vague legal standards and the lack of consumer protection mechanisms, moderate regulation and guidance have become inevitable. The new trust and support for cryptocurrencies also indicates that the framework is about to be implemented.

The formulation of rules is crucial because only with clear rules can market participants compete fairly.

By embracing cryptocurrencies, the new generation is expected to promote a future centered on innovation, stability and global leadership. Whether it is federal level, state initiatives or regulatory reforms, the United States is standing at the crossroads of a new era of digital assets, and its strategic vision and adaptability will determine the future industry landscape.

3) Regulatory balance: Challenges and opportunities for advancing

The approval of Congress still faces resistance. Some lawmakers have expressed concerns about economic stability and inflation, while ongoing regulatory uncertainty and public doubts may hinder the implementation of cryptocurrency reserves.

New is a key task lies in finding a regulatory balance between efficiency and innovation. Only with proper supervision can level crypto reserves and the entire crypto industry flourish in the United States.

It is worth noting that with the implementation of other accelerated cryptocurrencies, the United States may lag behind global competition without taking proactive measures.

Establishing cryptocurrency reserves and introducing supportive regulations will not only consolidate the U.S. leadership in the global crypto economy, but will also drive technological innovation and growth in capital investment.

4) The United States' responsibility: establish confidence in the global crypto capital center

The United States has always been a leader in the global capital market with high standards of consumer protection, data security and financial transaction rules.

If others take the lead in digital asset regulation and the United States fails to follow up, the global market may be affected by more instability. Therefore, the United States should clearly express its full faith in cryptocurrency and formulate a more stable one as a global crypto economy center.