Bitcoin stumbled early Friday, slipping below $85,000 overnight before rebounding to around $88,000.
The 3% decline over the past 24 hours highlights growing uncertainty among traders, who had anticipated bullish momentum following President Donald Trump’s executive order establishing a strategic Bitcoin reserve.
However, instead of a large-scale government acquisition, the reserve will be seeded with Bitcoin already owned by the federal government through criminal and civil asset forfeitures. White House crypto czar David Sacks emphasized that this approach “will not cost taxpayers a dime,” but the lack of new government purchases left investors disappointed.
Strategic Bitcoin Reserve: A Game Changer or a Political Play?
Trump’s move marks a stark contrast from his previous skepticism of cryptocurrencies. The reserve, described as a “digital Fort Knox,” aims to establish Bitcoin as a long-term strategic asset for the U.S. government. Sacks revealed that Washington holds approximately 200,000 Bitcoin, a sum that could have been worth $17 billion had the government not sold off half of its holdings over the past decade.
While the executive order grants Treasury and Commerce officials authority to explore “budget-neutral” strategies for future acquisitions, there is no immediate plan for large-scale Bitcoin purchases. This uncertainty has fueled concerns that the reserve could remain a symbolic move rather than a significant shift in U.S. financial policy.
Crypto Summit Looms as Market Awaits Clarity
The timing of the announcement coincides with a high-profile White House crypto summit, where industry leaders—including Coinbase (COIN) CEO Brian Armstrong and MicroStrategy’s (MSTR) Michael Saylor—are expected to push for clearer regulatory frameworks. The event could provide further direction for digital assets, particularly regarding the SEC’s recent pivot away from aggressive enforcement actions against crypto firms.
Despite Bitcoin’s recent slump, analysts argue that the strategic reserve marks an important step toward institutional legitimacy. “This is a watershed moment—not for an immediate price surge, but for Bitcoin’s long-term adoption as a reserve asset,” said Pepperstone strategist Dilin Wu.
As the market digests Trump’s latest policy shift, Bitcoin remains volatile, trading well below its all-time high of $109,000 set in January. Investors will be watching closely for further developments at the White House summit, as any additional pro-crypto moves from Washington could reignite bullish sentiment in the digital asset space.
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