14.08.2025 15:25
Bitcoin experienced a dramatic price plunge on Thursday following a definitive statement from the US Treasury. The announcement, that the government would not be making further Bitcoin purchases for its reserves, immediately reversed the earlier bullish momentum which had pushed prices to a near $124,120 intraday high. The subsequent sell-off saw Bitcoin retreat to approximately $118,550, triggering widespread market jitters and substantial liquidations in the crypto futures market.
US Treasury Secretary Scott Bessent, in an interview with Fox Business, explicitly stated the government's intention to halt additional Bitcoin acquisitions. He clarified that future additions to the Bitcoin reserve would exclusively originate from confiscated assets. Bessent also estimated the current value of the government's Bitcoin holdings to be between $15 billion and $20 billion. This announcement starkly contrasts with a previous executive order from President Trump advocating for budget-neutral strategies to expand the government's strategic Bitcoin reserves. The shift in policy fueled the subsequent market reaction.
The swift market downturn erased a significant portion of Thursday's gains. Reports indicated a rapid price drop from around $121,050 to as low as $117,201 within a single hour, with other sources placing the low near $118,460. This volatility coincided with approximately $450 million in liquidations across various trading platforms. Market analysts attributed the sharp price reversal to the clarified government policy. The previous anticipation of a potential government buyback program, which had fueled investor optimism, dissipated following Bessent's remarks. This removal of a significant, predictable buyer from the market amplified the price swings.
Bessent’s comments were also framed within a broader macroeconomic context. He linked future Treasury balance sheet adjustments to increasing tariff revenues, highlighting nearly $30 billion collected in July alone, suggesting that annual tariff receipts might surpass previous projections of $300 billion. This potential revenue stream could influence other government asset strategies. This announcement came alongside the release of US Producer Price Index data showing a 3.3% year-over-year and 0.9% month-on-month increase for July, further impacting the overall economic picture influencing investor sentiment.
The Treasury Secretary's emphasis on utilizing confiscated assets to augment the Bitcoin reserve represents a fundamental change in acquisition strategy. This shift eliminates direct market purchases by the Treasury, implying a slower, less predictable growth trajectory for the reserve, entirely dependent on law enforcement seizures. This lack of a consistent, large-scale buyer, market participants argued, contributes to heightened price volatility, as demonstrated by the significant price swings observed on Thursday.
