Governments Worldwide Increasingly Embrace Bitcoin as a Strategic Asset

As Bitcoin (BTC) and other digital assets gain momentum on the global stage, governments around the world are exploring diverse strategies to incorporate Bitcoin into their national reserves. From asset seizures and direct mining investments to strategic acquisitions and unconventional use cases, sovereign approaches to Bitcoin are shaping up to reflect varying economic and political objectives. This growing trend, often referred to as "Bitcoin Treasuryization," signifies a transformative shift in how nations perceive and manage the cryptocurrency—whether as an alternative foreign reserve, a tool for wealth accumulation, or even a strategic resource.

Asset Seizures: U.S. and U.K. Dominate Bitcoin Holdings Through Law Enforcement Efforts

The United States has emerged as the largest Bitcoin-holding government, primarily through law enforcement-driven asset seizures. As of October 19, on-chain analytics firm Arkham Intelligence estimated that U.S. authorities hold 325,447 BTC, representing roughly 1.55% of Bitcoin’s total supply and valued at approximately $34 billion. Among the most notable confiscations was a July 2024 seizure of 127,271 BTC from a Chinese national, marking one of the largest recoveries in history.

Most of these holdings stem from enforcement actions targeting criminal activities such as cybercrime, hacking, tax evasion, and operations on dark web marketplaces. While the U.S. Marshals Service officially manages 29,000 BTC, analysts suggest the total government-controlled amount is likely much higher.

The United Kingdom ranks second globally, with an estimated government-held Bitcoin reserve of 61,245 BTC valued at $6.56 billion. Early reports claiming China retained a sizable stash of 190,000 BTC were debunked, as blockchain analysis revealed that the nation sold off its holdings in 2020.

Direct Mining: Resource-Rich Nations Like UAE and Bhutan

Countries with robust energy and infrastructure resources, such as the United Arab Emirates (UAE) and Bhutan, are opting to skip traditional acquisition methods, investing directly into Bitcoin mining operations. These initiatives represent strategic maneuvers to leverage their energy reserves and technological prowess to gain a foothold in the burgeoning digital asset market.

In the UAE, the Royal Group has partnered with Citadel Mining to build Bitcoin mining facilities, collectively holding around 6,465 BTC valued at $692 million. Likewise, Bhutan's sovereign wealth fund, Druk Holdings, collaborates with Bitdeer to tap into its hydroelectric power infrastructure for efficient Bitcoin mining. Bhutan’s holdings amount to approximately 6,370 BTC, valued at $682 million. Both nations view Bitcoin as a unique tool to diversify their foreign reserves and enhance overall national wealth.

Strategic Acquisitions: El Salvador’s Bold Experiment With Legal Tender

El Salvador has pioneered an unprecedented use for Bitcoin by declaring it legal tender in 2021. Through deliberate government-led purchases, the nation has amassed 6,354 BTC, currently valued at $680 million. This strategy is intended to integrate Bitcoin into its broader financial ecosystem while positioning it as part of the country’s foreign exchange reserves.

El Salvador’s approach is closely tied to fostering economic innovation, aiming to attract foreign investments and boost financial inclusion. While few countries have followed in its footsteps, analysts predict that this model could inspire other developing nations seeking alternative ways to stabilize their economies or hedge against reliance on traditional fiat currencies.

Unofficial Holdings: North Korea’s Lazarus Group and Cyber Theft

North Korea presents a unique case in government-linked Bitcoin accumulation, albeit through illicit channels. The state-sponsored cybercriminal organization known as the Lazarus Group has exploited Bitcoin as a pseudo-reserve asset. Through activities such as hacking and ransomware attacks, the group once possessed over 14,000 BTC.

More recent reports suggest, however, that North Korea's holdings have dwindled to approximately 804 BTC, now valued at $86 million—a stark reduction attributed to liquidation efforts or theft losses. While this usage diverges from official strategic reserves, it highlights broader geopolitical dimensions tied to Bitcoin, including its role in circumventing global sanctions or financing state activities through decentralized networks.

A Paradigm Shift Toward Bitcoin as Reserve Diversification

The rise of Bitcoin holdings at the governmental level underscores its evolving perception as a potential component of foreign exchange reserves—a shift from merely seizing or storing assets to actively managing them as strategic tools. Experts increasingly view Bitcoin as part of a long-term strategy to diversify away from traditional pillars such as gold and the U.S. dollar.

An on-chain analyst remarked, “While government-held Bitcoin still accounts for a small fraction of the total circulating supply worldwide, the diversification of acquisition methods—mining, asset management, and legal incorporation—is evidence of its growing importance. Resource-rich nations have unique advantages in mining, while financially advanced governments may focus on enforcement actions and investments to bolster their holdings.”

As Bitcoin continues its transition from a speculative asset to a recognized financial instrument, its role in sovereign wealth strategies is likely to expand. Governments with advanced technology, substantial energy resources, or innovative fiscal policies may increasingly look to Bitcoin as both a means of capital accumulation and a stabilizing force in foreign reserve management. Digital assets are steadily reshaping the economic playbook, signaling broader adoption among forward-thinking nations.