Crypto and Geopolitics: The Strategic Layer

What you'll learn

• The U.S. Strategic Bitcoin Reserve and Digital Asset Stockpile
• The GENIUS Act, Tornado Cash Delisting, and the Crypto Czar
• Geopolitical CBDCs: China e-CNY, Russia Digital Ruble, India e-Rupee
• Sanctions, Cybercrime, and State-Sponsored Theft
• National Bitcoin Experiments: El Salvador, Venezuela, CAR
• AI, ZK, Quantum, and Account Abstraction Convergence
• BRICS+ Digital Currency, Climate Tradeoffs, and the Strategic Outlook

Key terms

Strategic Bitcoin Reserve

Established by Trump executive order on March 6, 2025. Holds approximately 200,000 BTC obtained through forfeiture; no taxpayer funds for additional purchases; no sales permitted. The U.S. is the first major economy to hold Bitcoin as a sovereign reserve asset.

Digital Asset Stockpile

Companion to the Strategic Bitcoin Reserve, holding non-Bitcoin digital assets obtained through forfeiture, specifically including ETH, XRP, SOL, and ADA. Treasury manages it more actively than the BTC Reserve.

GENIUS Act

Guiding and Establishing National Innovation for U.S. Stablecoins. Signed into law July 18, 2025. First federal statutory framework for U.S.-issued stablecoins: 100 percent reserve backing, monthly disclosures, AML compliance, OCC or qualifying state supervision.

Tornado Cash delisting

On March 21, 2025, Treasury removed Tornado Cash and 100-plus Ethereum addresses from the OFAC SDN list following the Fifth Circuit's November 2024 ruling that OFAC exceeded its statutory authority. Major precedent for crypto privacy: open-source code itself cannot be sanctioned.

David Sacks (Crypto Czar)

Appointed AI and Crypto Czar by President Trump on January 23, 2025, chairing the Working Group on Digital Asset Markets. Bo Hines serves as Executive Director.

e-CNY (digital yuan)

China's CBDC. Approximately 261 million users and RMB 14.2 trillion (about 2 trillion dollars) cumulative volume by September 2025; about 3.4 billion transactions worth roughly 2.3 trillion dollars by November 2025. Tied to Belt and Road Initiative cross-border settlement.

Lazarus Group

North Korean state-sponsored advanced persistent threat actor. TRM Labs reports more than 6.75 billion dollars in cumulative crypto theft. The February 2025 Bybit hack stole approximately 1.5 billion dollars in ETH — the largest single crypto theft in history. UN Panel of Experts has documented theft proceeds funding nuclear weapons program.

El Salvador Bitcoin repeal

In January 2025, El Salvador repealed mandatory Bitcoin acceptance under conditions of a 1.4 billion dollar IMF loan program. Bitcoin remains legal but no longer required; the country maintains a Strategic Bitcoin Reserve of approximately 6,102 BTC (about 500 million dollars at May 2026 prices).

FATF Travel Rule

Financial Action Task Force standard requiring crypto exchanges to share sender and recipient information for transactions above specified thresholds, mirroring traditional banking AML requirements.

Post-quantum cryptography

Cryptographic algorithms designed to resist quantum computer attacks. NIST finalized standards (CRYSTALS-Kyber, CRYSTALS-Dilithium, FALCON, SPHINCS+) in August 2024. Bitcoin and Ethereum have proposals under discussion for migration; threat horizon estimates range from 2030 to 2040.

BRICS+ digital currency

Discussions among the expanded BRICS coalition (Brazil, Russia, India, China, South Africa, plus newer members) about shared digital currency or settlement infrastructure as an alternative to dollar dominance. No concrete launch as of May 2026; bilateral arrangements more likely than unified currency.

Project mBridge

A multi-CBDC platform involving the central banks of China, Hong Kong, Thailand, the UAE, and Saudi Arabia (with the Bank for International Settlements as a current participant), exploring cross-border CBDC settlement.