White House Report to Support Crypto Rules. Just Don’t Expect Bitcoin Reserve Details.

Congress is already taking action on cryptocurrencies. Above, the U.S. Capitol reflected in a puddle in Washington, D.C. (Stefani Reynolds/Bloomberg)

A White House working group on Wednesday released details of a highly anticipated report meant to provide a roadmap for U.S. cryptocurrency policy. The biggest dream—specific plans for a bigger U.S. Strategic Bitcoin Reserve—will have to wait.

The President’s Working Group on Digital Asset Markets on Wednesday will unveil a highly anticipated report outlining legislative and regulatory proposals. In advance of the report, senior administration officials held a call with reporters outlining what to expect and released a fact sheet on what it will contain.

The group, established by an executive order in January, was tasked with suggesting a framework for digital-asset regulation and criteria for a “digital asset stockpile” of Bitcoin and other cryptocurrencies.

While the 160-page report will provide extensive legislative and regulatory recommendations, senior administration officials in a briefing with reporters on Wednesday said that more specifics on the Bitcoin reserve will come from the Treasury Department later.

Cryptocurrencies and stocks of digital-asset companies such as Coinbase Global have soared since President Donald Trump took office in January. Agencies have dropped enforcement actions against crypto firms, while Trump has lifted regulatory barriers on banks and exchanges in the name of making the U.S., in Trump’s words, the “crypto capital of the world.” Bitcoin’s price this year has risen about 26% to $117,650.

The January order tasked the working group with drafting its proposals in 180 days, a deadline that passed earlier this month. In the intervening period, Congress and the White House plowed ahead on much of the work that the report was to address.

Trump, for example, has already signed into law a bill creating rules for stablecoins, a kind of cryptocurrency that is typically pegged to the dollar. The House of Representatives has also already passed a bill to establish rules for other tokens and exchanges, with the Senate expected to take up similar legislation in the fall.

Wednesday’s report will still contain dozens of regulatory and legislative recommendations, the senior administration officials said on the briefing.

A two-page factsheet said that the report would recommend that the Securities and Exchange Commission and the Commodity Futures Trading Commission provide “clarity to market participants on issues such as registration, custody, trading, and recordkeeping,” a long-standing request from the crypto industry. The report also said the agencies should let new products reach consumers “without bureaucratic delays” by providing safe harbors and regulatory sandboxes.

The report will also make suggestions on how to shape congressional legislation, but its influence might be more limited given that the work is well under way.

Some crypto investors had hoped Wednesday’s report would provide more information on the creation of a digital-asset stockpile, which Trump has dubbed a Strategic Bitcoin Reserve. In March, Trump created the reserve via an executive order that declared the stockpile would be made up of digital assets seized in law-enforcement actions. Before the order, the government had tended to sell seized assets on exchanges.

Any signal that the U.S. planned to become an active buyer of cryptocurrencies would likely cause token prices to take off. The senior administration officials said Treasury would provide more information on the reserve “in short order,” mirroring what Barron’s had reported earlier on Wednesday.

Proposals for budget-neutral Bitcoin purchases “could act as a major catalyst” for crypto, wrote Fundstrat head of digital asset strategy Sean Farrell in a research note.

The White House fact sheet said the report would support the House crypto legislation’s proposal to make the CFTC the regulator for non-security digital assets, which includes Bitcoin. It also will recommend that Congress pass bills prohibiting the issuance of a U.S. central bank digital currency and modifying tax rules for crypto trading such as making the assets subject to wash-sale rules, which currently don’t apply.

The Trump administration may yet find a way to increase the U.S. Bitcoin stockpile. Investors just shouldn’t expect to see that path clearly on Wednesday.

Write to Joe Light at joe.light@barrons.com