An executive order calling for the establishment of an American sovereign wealth fund was signed by President Donald Trump on Monday, and Bitcoin owners are now seeing gold.

Crypto supporters jumped with excitement after Trump announced that he had ordered the U.S. government to establish a sovereign wealth fund within the next 12 months, interpreting the announcement as evidence that the United States was actively investing in the world’s best cryptocurrency.

Most notably, Sen. Cynthia Lummis (R-WY ), a prominent Bitcoin advocate, referenced Bitcoin when she reacted to the news. This is a “g deal,” she wrote on X, using the Bitcoin”” sign to send crypto enthusiasts into an ecstatic tizzy. BTC is up 4 % on the day, to$ 102, 050 at writing.

But what are sovereign wealth funds exactly, and how do they fluctuate from the idea of a long-awaited U.S. proper Bitcoin supply? &nbsp,

Sovereign wealth funds are state-owned purchase funds that take state revenues—often earned from exporting healthy resources—and reinvest them in effectively successful assets like stocks, bonds, and real estate. &nbsp,

While some U. S. says, most somewhat Alaska and Texas, operate their own sovereign wealth funds, the country as a whole has not operated one. &nbsp,

However, it is unclear whether Bitcoin or a strategic reserve that would hold the asset is connected to an American sovereign wealth fund. &nbsp,

On one hand, it is true that some of the world’s top state-run wealth funds have substantial exposure to crypto generally, and Bitcoin specifically. Norway’s sovereign wealth fund, the largest on Earth, indirectly holds nearly$ 400 million worth of Bitcoin, according to K33 Research. &nbsp,

Abu Dhabi’s sovereign wealth fund, another goliath, routinely invests in crypto projects and digital assets. &nbsp,

However, by creating an American sovereign wealth fund, it is not guaranteed that the US government will be launching a Bitcoin venture. Such funds can be financed in part by a nation’s federal reserve, but crypto is not yet part of that stockpile.

Perhaps policymakers like Lummis have a compelling argument that an American sovereign wealth fund could focus solely on Bitcoin, or perhaps they are just trying to bring the future they so fervently desires into reality.

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