China is accelerating legislation to adopt a strategic Bitcoin reserve, but concrete evidence remains elusive. The idea has surfaced amid speculation of a global “Bitcoin arms race,” especially following U.S. President Donald Trump’s crypto-friendly rhetoric and proposals for a U.S. strategic reserve post his 2024 election win.
Posts on microblogging site X and some crypto news outlets, like CryptoBriefing on March 3, 2025, cite David Bailey, CEO of BTC Inc., claiming China is “working double time” on this, based on “closed-door meetings” since the U.S. election. However, no official statements from Chinese authorities confirm this, and the narrative hinges on insider speculation rather than documented policy.
China’s relationship with Bitcoin is complex. Since 2021, it has banned domestic crypto trading and mining, slashing its once-dominant 70%+ share of global Bitcoin hash rate. Yet, it holds significant Bitcoin—around 194,000 BTC (worth ~$18 billion at current prices) seized from the 2019 PlusToken scam, according to CryptoQuant CEO Ki Young Ju. Posts on X suggest China might retain rather than sell this stash, aligning with a reserve strategy, though a January 2025 report indicated sales occurred. The lack of transparency from Beijing fuels uncertainty—did they sell, hold, or quietly accumulate more?
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The rumored legislation could tie into broader geopolitical goals, like de-dollarization. Analysts speculate China sees Bitcoin as a hedge against U.S. financial dominance, especially as BRICS nations explore alternatives to the dollar. A strategic reserve might also counter Trump’s plans, which include a U.S. stockpile of Bitcoin, Ethereum, and other assets, as announced on Truth Social in early 2025. If true, China’s move could be a preemptive strike in a digital currency power play.
A Bitcoin reserve’s scalability for China would leverage its existing holdings and economic might. With over $3 trillion in foreign reserves (mostly U.S. Treasuries), adding 500,000 BTC (~$46 billion at $92,000/BTC) as some crypto analysts claim, is plausible but modest—about 1.5% of its reserves. Bitcoin’s fixed 21 million supply (19.9 million mined by 2025) means China could aim for 2–5% of it, mirroring U.S. gold reserve strategies (5% of global gold). Unlike MegaETH’s tech-driven scalability, this is about financial and strategic capacity—China’s centralized control could execute bulk purchases via OTC markets or state-backed entities, bypassing its trading ban.
Challenges include Bitcoin’s volatility (e.g., 17% drop in February 2025) and legal hurdles. Legislation would need to reconcile the 2021 ban with state adoption, possibly framing Bitcoin as a reserve asset, not a currency for citizens. Enforcement could rely on existing cybersecurity laws—like the 2020 Cryptography Law—while sidestepping decentralized mining or trading.
No public Chinese legislation exists as of now. Bailey’s claims lack primary sources, and Beijing’s censorship obscures verification—X posts calling it a “censored regime holding censorship-resistant money” highlight the irony. Past actions (selling seized BTC) and Hong Kong’s 2024 BTC/ETH ETF approvals suggest a nuanced shift, but not a confirmed reserve policy. Meanwhile, U.S. states (e.g., Oklahoma, Arizona) and Senator Cynthia Lummis’ Bitcoin Act (proposing 1 million BTC over five years) offer a clearer legislative blueprint China might emulate.
If China legislates a reserve, it could spike Bitcoin demand, pushing prices toward $100,000+ as supply tightens. It’d signal nation-state adoption, accelerating global competition—BRICS might follow. Yet, without official word, this remains speculative. China’s silence contrasts with U.S. openness, leaving the “speeding up” claim tantalizing but unproven.