Bitcoin plunged as much as six per cent on Thursday after United States President Donald Trump’s executive order to establish a “Strategic Bitcoin Reserve” failed to meet market expectations.
The cryptocurrency fell to as low as $84,900 following the announcement before recovering slightly to trade at $87,700 as of 5:00 GMT. The decline came as investors were left unimpressed by the lack of concrete government purchase plans in the order.
Trump’s directive, unveiled by his administration’s crypto adviser David Sacks, outlined a plan to capitalise the reserve using digital assets seized in criminal or civil cases. “This means it will not cost taxpayers a dime,” Sacks said in a statement on X, adding that a full audit of the federal government’s Bitcoin holdings—estimated at 200,000 BTC—had also been ordered.
The order further tasked the Secretaries of Treasury and Commerce with formulating “budget-neutral strategies for acquiring additional Bitcoin,” provided they incurred no cost to taxpayers.
Bitcoin had rallied significantly following Trump’s election victory in November, hitting an all-time high of $109,071 in mid-January.
The president’s support for cryptocurrency has, however, faced scrutiny amid reports that his family has amassed billions in digital assets, including a Trump-themed meme coin launched earlier this year.
Critics of cryptocurrencies have long argued that they lack intrinsic value and likened their rapid rise to a speculative bubble or Ponzi scheme.
