Congress Just Took a Major Step Toward Signing the Strategic Bitcoin Reserve Into Law. Here's What Bitcoin Investors Need to Know.

During his first year in office, President Donald Trump issued an executive order to create a Strategic Bitcoin (CRYPTO:BTC) Reserve in the U.S., as well as a Digital Asset Stockpile.

However, since then, there's been little news about this effort or whether it would be much more than just an order. But now lawmakers are moving to codify it.

By a 28-21 vote split among party lines, the U.S. House Committee on Financial Services voted to advance The American Reserve Modernization Act (ARMA) of 2026, which brings it one step closer to a House vote.

As of this writing, the price of Bitcoin, the world's largest cryptocurrency, traded roughly 0.7% higher. Here's what Bitcoin investors need to know.

Image source: Getty Images.

What would ARMA do?

ARMA would require the U.S. government to hold all Bitcoin currently in its possession in a reserve for at least two decades. The crypto intelligence platform Arkham estimates that over $25 billion worth of Bitcoin is under government control.

All federal agencies would need to disclose digital assets in their control and create accounting practices, such as "proof of reserve" reports.

The bill would also order a study of ways the government could expand the Strategic Bitcoin Reserve through budget-neutral acquisitions.

"We cannot allow Bitcoin to be held by the federal government to languish in fragmented and inconsistent custody," U.S. Representative Nicholas Begich (R-AK), a co-sponsor of the bill, said, according to Cointelegraph. "It poses unacceptable cybersecurity risks and fails to give an adequate accounting of what the federal government actually owns."

ARMA would also look to create a Digital Asset Stockpile. While it's not exactly clear which cryptocurrencies would be included in such a stockpile, in March 2025, Trump named Ethereum, XRP, Solana, and Cardano as other cryptocurrencies included in a "Crypto Strategic Reserve."

Fundamentally, it's hard to see how having Bitcoin already under government control in a strategic reserve would really change the supply-demand dynamic.

But I guess it would guarantee that the government-controlled Bitcoin would be locked up for 20 years and therefore not in the circulating supply. The investment thesis on Bitcoin is that it is a store of value and a form of digital Gold, based on its finite supply of 21 million tokens.

So, the more in demand Bitcoin is, the better for the token’s price. If the government could find ways to buy more Bitcoin, that would be more significant in my eyes because it would create a really strong, long-term buyer in the market for Bitcoin that would be more transparent than a Bitcoin whale.

Still a long way to go before passage

While Trump used an executive order to establish a Strategic Bitcoin Reserve and Digital Asset Stockpile, securing passage of ARMA would be much more significant.

Executive orders can be reversed by the next President, and they have more limited power over federal funding.

The problem for Trump is that passing crypto legislation in Congress has proven much more difficult, as evidenced by the Clarity Act.

Democrats are not happy with all the money Trump has reportedly made on his crypto ventures, and want stronger ethics provisions in place.

The fact that the committee vote went along party lines is telling. There is also only so much time before the midterm elections, and the Democrats could very well reclaim control of the House.

So, while passage of ARMA would likely be good for Bitcoin, the bill is far from becoming law.

Bram Berkowitz has positions in Bitcoin, Ethereum, and XRP. The Motley Fool has positions in and recommends Bitcoin, Ethereum, Solana, and XRP. The Motley Fool has a disclosure policy.