Bitcoin Price Weakens Amid Market Volatility as U.S. Announces Strategic Reserves

The price of Bitcoin weakened amid ongoing market volatility following an executive order signed by U.S. President Donald Trump to establish a strategic Bitcoin reserve for the United States.

According to Coinmarketcap.com, on Monday (March 10, 2025), Bitcoin dropped by over 5%, hitting a low of US$81,712 before rebounding to around US$82,000. Other cryptocurrencies, including Ether and XRP, also declined by approximately 7.5%.

As reported by CNBC International, the reserve will be funded by Bitcoin seized in criminal and civil forfeiture cases, with no plans for the U.S. government to purchase additional Bitcoin at this time.

Investors Disappointed, But Long-Term Optimism Remains

Following the strategic reserve announcement last Thursday, the crypto market saw a downturn, as investors were disappointed by the lack of aggressive government action. However, some investors believe the move will be beneficial in the long run.

"I think the market got it wrong. Investors were expecting the government to immediately acquire 100,000 to 200,000 Bitcoin," said Matt Hougan, Chief Investment Officer at Bitwise Asset Management.

Hougan referenced a statement from David Sacks, the White House’s Crypto and AI Czar, who noted that the U.S. would explore a budget-neutral strategy for acquiring additional Bitcoin without imposing extra costs on taxpayers.

"The key question to ask is whether this executive order makes Bitcoin more likely to become a geopolitically significant currency or asset in the future," Hougan said.

According to him, if other governments follow the U.S. lead and build their own strategic reserves, Bitcoin’s price could surge well beyond US$80,000, potentially reaching US$1 million per coin.

U.S. Holds $17.5 Billion in Bitcoin Reserves

Despite the recent price decline, Hougan considers this a short-term setback. "The market will soon stabilize and recognize that this policy is highly beneficial for Bitcoin and the overall crypto ecosystem in the long run," he added.

According to Bloomberg, the U.S. government currently holds Bitcoin worth approximately US$17.5 billion, along with US$400 million in other crypto assets, stored in identified digital wallets, as reported by blockchain analytics firm Arkham.

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