With the US economy facing instability, consumer confidence plummeting, and whispers of an impending recession growing louder, the Trump administration’s handling of the economy is under intense scrutiny. However, Thursday’s executive order establishing a federal Bitcoin reserve was expected to provide some stability and optimism to the cryptocurrency sector. Instead, it has left the market underwhelmed and crypto enthusiasts disillusioned.
Crypto Market Enthusiasm Turns to Disappointment
In January, President Trump hinted at creating a federal Bitcoin stockpile, sparking excitement and sending Bitcoin prices soaring. Bitcoin reached a record high of over $109,000 in January, surpassing the $100,000 mark for the first time in early December. Yet, following Trump’s executive order, the market response has been less than favorable. Bitcoin’s value plummeted by nearly five percent to $85,000 and, at the time of writing, was still hovering around $88,000—an almost 20 percent drop from its January peak.
A Title Without Substance
Many in the crypto industry were expecting a more robust move from the federal government. However, the reserve established by the executive order was largely comprised of Bitcoin already in the possession of the government, obtained through civil asset forfeitures or seizures. While the order leaves room for future Bitcoin purchases, the reality is that no immediate buying action will take place. White House crypto czar David Sacks clarified that the government is only authorized to develop budget-neutral strategies for acquiring additional Bitcoin without imposing costs on American taxpayers.
Charles Edwards, founder of Capriole Investments, expressed the frustration of the crypto community, calling the move “the most underwhelming and disappointing outcome we could have expected for this week.” He further added, “This is just a fancy title for Bitcoin holdings that already existed with the government. This is a pig in lipstick.”
Expanding the Digital Asset Stockpile
The executive order also includes plans for a “US Digital Asset Stockpile” which will encompass other cryptocurrencies such as Ether, XRP, Solana, and Cardano. However, the announcement hasn’t done much to inspire confidence, as the market remains uncertain about future developments.
Conflicts of Interest and Industry Concerns
As industry executives meet at the White House to discuss regulatory matters, concerns over potential conflicts of interest have emerged. President Trump and his wife, Melania, hold memecoins, which have seen significant value drops, and Trump’s reported stake in World Liberty Financial—a crypto platform—raises further questions about the administration’s involvement with the industry.
Analysts believe the crypto market is seeking clearer regulatory policies or signs that the Federal Reserve may cut interest rates to help revive investor confidence. Despite Trump’s campaign promises to make America the “crypto capital of the planet,” the current uncertainty continues to dampen the enthusiasm surrounding his federal Bitcoin reserve.
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