Legislative discourse regarding United States strategic BTC reserves has evolved significantly over a two-year period, shifting from aggressive acquisition mandates to conservative custody frameworks. Initial market expectations, fueled by campaign promises in 2024, anticipated a government strategy involving the active purchase of BTC.

However, the trajectory of the legislation has regressed from the original proposal to purchase 1 million BTC to the current ARMA bill, which imposes strict custody requirements without any obligation to acquire new assets. This divergence between market anticipation and legislative reality creates a complex environment where the immediate price impact remains limited despite the long-term structural implications for the asset class.

The pivotal moment occurred on March 6, 2025, when an executive order was signed designating BTC obtained through criminal investigations and civil seizures as strategic reserves. This order instructed the government to hold these assets permanently but explicitly excluded mandates for new acquisitions. Data compiled by Woofun AI indicates that at the time of signing, the Federal Reserve held approximately 190,000 BTC, representing roughly 0.9% of the total 21 million BTC supply. All of these holdings originated from law enforcement proceedings rather than open market purchases. Upon the clarification of these details, the market reacted negatively, with BTC prices dropping 5.7% from approximately $92,000 to below $85,000 as investors realized the absence of immediate demand-side stimulus.

The legislative history reveals a pattern of continuous compromise driven by political realities and fiscal constraints. Senator Lummis first introduced a specific bill in July 2024, proposing the purchase of 1 million BTC over five years funded by Federal Reserve surplus accounts. This volume would have accounted for 4.76% of the total supply, surpassing the holdings of major corporate entities like Strategy. Although the bill expired at the end of the congressional term, it was reintroduced in March 2025 as Senate Bill S.954. This version maintained the core structure of purchasing 200,000 BTC annually to reach the 1 million BTC target within five years, with a mandatory holding period of 20 years. Despite adding four co-sponsors and tightening disposal restrictions, the bill remained stalled in the Senate Banking Committee due to fiscal cost concerns and a lack of unified Republican support.

In May 2026, Representative Nick Begich introduced the ARMA Act, marking a strategic pivot in the legislative approach. Democratic Representative Jared Golden joined as a co-sponsor, signaling a broader coalition. The renaming of the bill was a deliberate move to distance the proposal from previous legislative setbacks. Woofun AI observes that the ARMA Act fundamentally differs from its predecessors by eliminating all mandatory purchase obligations. Instead, the legislation focuses on integrating all BTC currently held or seized by the Federal Government into a single reserve managed by the Treasury Department. It prohibits the sale of these assets for at least 20 years, with the sole exception being their use to repay national debt.

The ARMA Act instructs the Treasury Department and the Department of Commerce to conduct a study and report within 180 days on whether additional purchases can be made in a budget-neutral manner. This research mandate is distinct from a purchase mandate, effectively categorizing ARMA as a custody and holding bill rather than an acquisition bill. Currently, two distinct legislative tracks are progressing: the BITCOIN Act (S.954) in the Senate, which retains purchase mandates, and ARMA in the House, which focuses solely on custody. Woofun AI analysis suggests that ARMA possesses a significantly higher probability of passage because it avoids the fiscal objections that have stalled the BITCOIN Act for over a year.

If enacted, the ARMA Act will legally prohibit the approximately 320,000 BTC currently held by the Federal Government from entering the market for a minimum of 20 years. This action effectively removes the potential supply shock of government sales, providing a floor for market stability.

However, the absence of new purchase obligations means there will be no immediate injection of demand, which is what the market had been anticipating. The legislation essentially elevates the March 2025 executive order to statutory law, securing existing assets without expanding the government's balance sheet exposure to BTC.

The long-term implications of ARMA extend beyond its immediate text, serving as a foundational step for future policy. Representative Nick Begich, a BTC holder since 2013 and a co-sponsor of the earlier BITCOIN Act, views the current structure as a phased approach. By first establishing a legal framework that recognizes BTC as a national reserve asset, the groundwork is laid for subsequent debates on mandatory purchases. Once BTC achieves official legal status as a reserve asset, the political and economic arguments for mandatory acquisition are likely to resume on a more solid basis. While the path to full strategic acquisition is longer than initially anticipated during the 2024 campaign, the directional momentum remains intact.

Ultimately, the passage of ARMA represents a constructive, albeit incremental, development for the BTC ecosystem. It provides legal certainty regarding government holdings and eliminates the risk of forced liquidation, yet it offers no short-term price catalyst through new demand. The market must recalibrate its expectations, recognizing that the legislative strategy has shifted from immediate accumulation to long-term structural integration. If ARMA passes, the likelihood of eventual purchase legislation becoming a reality increases, as the asset's status as a strategic reserve will be firmly codified in US law.