Governments Sell Their Bitcoin and Buy Gold

Bitcoiners are hoping that the Trump administration will pump their bags to new all-time highs this year with a Bitcoin Strategic Reserve. But all around the world, governments are selling bitcoin and buying gold, not the other way around.

In Jan. @CynthiaMLummis said that she thought China would get into the equivalent of an arms race with the U.S. over which nation could buy the most Bitcoin. I doubt it, especially if China was smart enough to have sold all of its Bitcoin during that month.https://t.co/rK1pjcETLK

— Peter Schiff (@PeterSchiff) March 22, 2025

Meanwhile, bitcoiners claim that it doesn’t “need” the state to endorse it. Yet, they cheer for any policy or candidate that promises to further legitimize their so-called cypherpunk freedom money, even as many of these State crypto schemes devolve, sometimes into outright fraud. Somewhat ironically, the US “bitcoin reserve” is currently made up solely of bitcoin that the government has confiscated from people through the courts or other legal actions.

Trump Crypto Czar David Sacks commented recently that if the US had held onto every bitcoin it has confiscated, its value would have gone from $366 million to over $17 billion.

“That’s how much it has cost American taxpayers not to have a long-term strategy.”

But the long-term strategy of governments and central banks around the world is to sell bitcoin, and buy gold instead. And despite its claims to radical transparency as a protocol, there seems to be a distinct lack of clarity as to the precise amount of bitcoin various governments have. In fact, Sacks’ source for his own numbers was Grok, X’s AI bot. Not even the Trump Administration’s Crypto Czar knows exactly how much crypto the US holds.

Over the past decade, the federal government sold approximately 195,000 bitcoin for proceeds of $366 million. If the government had held the bitcoin, it would be worth over $17 billion today. That’s how much it has cost American taxpayers not to have a long-term strategy.

— David Sacks (@davidsacks47) March 6, 2025

Many bitcoiners say they don’t “trust” the state, but at the same time, they are trusting the state to securely custody the private keys to the bitcoin that will pump up the price of their own holdings. If the government declares bitcoin strategically important and starts mining or buying, and something goes wrong and it loses its bitcoin forever (as many have), the price crashes. The bitcoin camp can’t seem to decide whether the state is their enemy or their savior. Gold has no such conflict, as it speaks for itself as a useful industrial metal and a hedge against inflation supported by thousands of years of monetary history. 

As Peter Schiff recently said on his podcast, the main buyers of gold are probably still central banks. And with central banks like the People’s Bank of China under-reporting and obscuring their purchases, whatever the reported number is at any given time is generally a lowball estimate. And along with governments in Germany and beyond, the trend is for governments to sell bitcoin as soon as they can, not to buy more.

In 2024, Germany sold tens of thousands bitcoin seized from a piracy operation. German officials explicitly cited bitcoin’s volatility as a reason to divest, redirecting some proceeds to purchase 30 tons of gold bullion. Russia offloaded thousands of bitcoin confiscated from ransomware attacks in 2023 and has been a huge buyer of gold, with a consistent trend of keeping a robust Russian gold stack to reduce its dependence on the US dollar.

Despite bitcoin’s lackluster gains after long-anticipated announcements of State approval from Trump, his cabinet, and his inner circle, gold is up 12% this year, and we haven’t even passed the first quarter yet. Meanwhile, silver still hasn’t surpassed its 2020 all-time high, which could be explained by ravenous central bank gold-buying. 

It may be a situation without precedent in the gold and silver markets, where gold makes such spectacular gains while silver remains below previous all-time highs. With the gold/silver ratio staying high and gold outpacing silver’s gains dramatically, it appears to be the setup for a tremendous bull market for silver.

Gold vs USD Year-to-Date

Peter said:

“This really highlights how great the opportunity is in silver. I think gold’s cheap too, but I think silver is a hell of a lot cheaper and people I think should be focusing a lot of their precious metals firepower on silver.”

The gold-silver ratio has remained well above 80 for all of 2025:

Gold-Silver Ratio Year-to-Date:

Instead of holding its stash, the US has sold the biitcoin it seized as a result of the Silk Road case, and has continued liquidating confiscated bitcoin. Meanwhile, the US imported tons of gold in 2024 to bolster its reserves. This pattern of selling volatile bitcoin and acquiring gold reflects a broader governmental preference for stability over speculation, and regardless of Trump’s bitcoin-related executive orders, the pendulum will always swing back to real assets.

Across the world, it’s a consistent strategy: governments are unloading bitcoin and central banks are stockpiling gold. The trend extends beyond Western powers. China, a longtime gold accumulator, has sold off minor bitcoin holdings while adding hundreds of tons of gold to its reserves in 2023 alone. India mirrors this approach, liquidating thousands of bitcoins seized from crypto scams while its central bank purchased gold. Globally, central banks bought a record amount of gold in 2022, with purchases accelerating into 2025, while bitcoin sales from government coffers have become routine.

Even the Trump administration’s much-hyped Bitcoin Strategic Reserve, launched this month via executive order, doesn’t buck this trend entirely. It aims to retain the estimated 200,000 bitcoins already seized. And regardless of what Trump says, across the globe, countries are sending a clear message: when it comes to securing wealth, gold trumps bitcoin every time.