On March 6, 2025, U.S. President Donald Trump signed an executive order at the White House to establish a “Strategic Bitcoin Reserve.” This move was anticipated as a potential game-changer for cryptocurrency markets, especially given Trump’s pro-crypto stance during his campaign. However, instead of soaring, Bitcoin’s price took a dive. Why did this happen? Let’s break it down.
1. The Order Didn’t Meet Market Hype
The executive order utilizes approximately 200,000 BTC—worth about $17.5 billion—already held by the U.S. government from criminal and civil seizures. Unlike expectations of a massive buying program akin to the Strategic Petroleum Reserve, the government isn’t injecting new funds to purchase Bitcoin. The White House emphasized a “zero-cost” approach, meaning no taxpayer money will be used to expand the reserve. Investors hoping for a demand surge were left disappointed, as this policy merely locks up existing assets without adding fresh buying pressure.
2. Short-Term Profit-Taking and Sentiment
Bitcoin had already surged significantly after Trump’s election, hitting an all-time high of $109,071 in January 2025. The signing was seen as a “sell-the-news” event: traders who bought in anticipation of this milestone cashed out when the order failed to exceed expectations. Coupled with broader market factors—like potential shifts in Federal Reserve policy or weaker economic data—this triggered a sell-off, pushing Bitcoin down over 5% from $90,000 to below $85,000, before a slight recovery to around $88,000 (as of midday Singapore time, March 6).
3. Long-Term Implications Still Unclear
While the immediate reaction was negative, the reserve could still bolster Bitcoin’s value over time. Locking up 1% of Bitcoin’s total supply reduces circulation, and White House crypto advisor David Sacks called it a “digital Fort Knox.” Yet, with no clear plans for active purchases or broader adoption, the market remains skeptical. The upcoming White House Crypto Summit on March 7 might clarify future steps, but for now, details are scarce.
4. Market Reaction in Real-Time
Posts on X reflected the sentiment: “Big hype, tiny splash—Bitcoin crashes accordingly.” The lack of aggressive action—like a commitment to regular BTC purchases—left traders unimpressed. Despite eliminating $1.8 billion in potential sell pressure from seized assets, the absence of a bold bullish catalyst drove the price down.
Conclusion
Bitcoin’s drop after Trump’s Bitcoin Reserve Order highlights a classic case of overhyped expectations meeting underwhelming reality. While the long-term outlook might improve if further policies emerge, the immediate fallout reflects investor frustration. Keep an eye on the March 7 summit—it could shift the narrative.
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