President Donald Trump’s announcement of a US crypto strategic reserve, which includes Bitcoin (BTC), Ethereum (ETH), XRP (XRP), Solana (SOL), and Cardano (ADA), has sparked a global discussion on the role of digital assets in national reserves. While the initiative aims to cement the United States as the crypto capital of the world, it also emphasizes the urgent need for enhanced security, privacy, and compliance solutions to support large-scale adoption.

With $1.5 billion stolen due to the latest ByBit hack, phishing attacks surging by 58% from 2022 to 2023, and nine out of ten organizations reporting security breaches, crypto transactions remain vulnerable. Generative AI-powered deepfakes, voice phishing, and social engineering schemes are growing more sophisticated, making it a must to integrate protective infrastructure into reserve-backed chains.

We need to redefine how digital assets are transacted, stored, and secured. Send to name technology, which automatically generates receive addresses that only transaction participants can access, ensuring no visible transaction history, offers such a solution. By embedding this infrastructure, along with off-chain KYC/AML compliance, the US crypto strategic reserve can enable frictionless yet fully compliant asset management for individuals, institutions, and AI-driven financial agents.

Securing reserve-backed digital assets

The foundation of any national crypto reserve must be built on a robust security infrastructure that mitigates risks from both external attackers and internal human errors. This means moving beyond raw wallet addresses and integrating cryptographic transaction protections, multi-layer authentication, and embedded security features that prevent unauthorized approvals.

One such approach involves dynamic, context-aware transaction verification, which ensures that only intended counterparties can access receive addresses—blocking phishing attempts before funds are sent. Additionally, integrating secure, encrypted communication layers directly into transaction protocols eliminates reliance on external messaging platforms, reducing exposure to interception or fraud.

Balancing privacy and compliance

Governments and institutions require compliance solutions, but on-chain KYC/AML measures often come at the expense of user privacy. Instead of permanently recording sensitive data on-chain, a decentralized identity verification layer can allow transactions to remain private while meeting regulatory requirements. This ensures compliance without creating centralized honeypots of user data that are prime targets for attackers.

Moreover, with Trump’s investment of $500B for the development of fast-evolving AI, there are likely to be a lot more AI-driven financial agents managing digital assets being built on increasingly sophisticated LLMS. However, those must operate under strict security standards. These agents require built-in safeguards that prevent them from executing transactions based on manipulated prompts or fraudulent counterparties. By integrating zero-trust security models and real-time transaction monitoring, AI-driven financial systems can minimize exposure to malicious actors.

A wake-up call for the industry

The recent Bybit exploit revealed a troubling reality that even experienced operators can be deceived. Attackers didn’t steal private keys, they tricked Bybit’s team—including the CEO—into approving fraudulent transactions via Ledger devices. This highlights the critical flaws in relying solely on raw wallet addresses and DeFi platforms that lack intelligent verification layers.

If Bybit had deployed a cryptographic name-based transaction system or contextual transaction warnings, the attack could have been flagged before approval. The industry must adopt security measures that proactively prevent human error and manipulation, ensuring transactions are not only private and compliant but also inherently resistant to fraud.

A secure future for US digital reserves

If the US is to lead in crypto, it must lead in security. A national crypto reserve isn’t just about asset selection, it’s about building infrastructure that protects users, institutions, and AI agents from an increasingly sophisticated threat landscape. Secure, privacy-preserving, and user-friendly transaction mechanisms will be essential to ensuring digital assets are as safe as they are valuable.

The Bybit hack should serve as a turning point. Instead of reacting to breaches after they occur, the crypto industry, especially national-scale initiatives, must implement preventive solutions now. The US crypto strategic reserve has the opportunity to set a new standard for digital asset security, making crypto transactions safer, more efficient, and resilient against emerging threats.

Michal “Mehow” Pospieszalski

Michal “Mehow” Pospieszalski is a seasoned tech leader with a track record of pioneering innovative solutions in the crypto world. As the CTO and co-founder of SwissFortress and CEO, co-founder, and co-inventor of MatterFi, Michal merges visionary strategy with hands-on tech know-how, propelling both companies towards defining the future of digital asset management.