According to a new research report from Fidelity, 2025 could be the year that central banks and sovereign governments around the world start buying Bitcoin (BTC +3.70%). That's a significant change, given how much money might flow into Bitcoin.
In fact, the amount of money flowing into Bitcoin might even surpass the amount that has already arrived via the new spot Bitcoin ETFs. If that's the case, then Bitcoin might skyrocket in value. But just how likely is this scenario? Let's take a closer look.
The strategic Bitcoin reserve
It's perhaps no surprise what led to this recent development of central banks and sovereign governments buying Bitcoin: a proposed plan by the U.S. government to launch a strategic Bitcoin reserve. While the U.S. government already ranks as the largest sovereign holder of Bitcoin in the world, there has never been any formal strategy in place to acquire crypto. The creation of a strategic Bitcoin reserve would change that.
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According to the BITCOIN Act of 2024, the U.S. could purchase as many as one million Bitcoins over a five-year period. That's equivalent to 5% of the total circulating supply of Bitcoin. That would, in essence, make the U.S. a Bitcoin juggernaut.
And there are even more aggressive estimates for how much Bitcoin the U.S. might buy. During the 2024 presidential election, then-candidate Robert F. Kennedy, Jr. (currently nominated to be the U.S. Secretary of Health and Human Services) proposed that the U.S. should buy 550 Bitcoins every single day until it had amassed a total of 4 million Bitcoins. That scale of Bitcoin buying, of course, is completely unprecedented.
But just keep in mind: There is no clear template for the U.S. to follow, and nobody is really even sure if this strategic Bitcoin reserve will ever be created. Already, the Trump administration appears to be backing away from characterizing this as a "Bitcoin reserve," and is instead referring to it as a "national digital asset stockpile." That suggests other digital currencies might be added to the mix.
Central banks and sovereign governments buying Bitcoin
Where things get interesting is when you consider what potential impact the creation of this strategic Bitcoin reserve might have on other nations. If the United States -- the biggest economic superpower in the world -- is buying Bitcoin, then other nations might have to as well. Otherwise, they might be left behind. Fidelity refers to this as "political and economic game theory," but longtime crypto investors know what this really is: FOMO, or the fear of missing out.
Right now, the best example of a nation strategically buying significant amounts of Bitcoin is El Salvador. It officially made Bitcoin legal tender in 2021, and has been buying Bitcoin aggressively ever since. According to Fidelity, it currently holds 6,000 Bitcoins worth an estimated $600 million.
That might sound like a lot of Bitcoin, but a single U.S. company -- MicroStrategy -- holds much more than that. As of January 2025, MicroStrategy held 471,170 Bitcoins. And the U.S. government, simply as a result of asset forfeitures and seizures, holds 198,000 Bitcoins. If the U.S. moves forward with plans for a strategic Bitcoin reserve, it might buy 200,000 Bitcoins in a single year!
Keep your eye, too, on what's happening in Europe. In early February, the head of the Czech Republic's central bank suggested that it might start buying Bitcoin. The current proposal is to buy $7 billion worth of Bitcoin, which is equivalent to approximately 5% of the Czech National Bank's international reserves. If that plan moves forward, it could lead to other European nations buying Bitcoin.
Could Bitcoin double in value?
The suggestion that Bitcoin could double in value as a result of all this new buying by central banks and sovereign governments might sound, well, far-fetched. Fair enough. But consider what happened with the new spot Bitcoin ETFs, and what impact they had on the price of Bitcoin.
CRYPTO: BTC
Key Data Points
In just a single year, these spot Bitcoin ETFs accumulated approximately $100 billion in assets under management. If we assume a price of $100,000 for Bitcoin, that's equivalent to roughly 1 million Bitcoins. That 1 million Bitcoin figure should sound familiar -- that's exactly the same amount of Bitcoin that the U.S. government plans to buy for its strategic Bitcoin reserve.
And we all saw what happened when so much buying of Bitcoin occurred. As soon as the new spot Bitcoin ETFs launched, the price of Bitcoin skyrocketed by 122%. Bitcoin literally doubled in price, from $44,000 in January 2024 to over $100,000 by December.
You can see where I'm going with this -- the trend of central banks and sovereign governments buying Bitcoin could be much bigger than anyone thinks. It quite literally could be a game changer for crypto. The rules of the global financial order would change, creating an entirely new game. The winner, of course, will be the nation that owns the most Bitcoin.
