Bitcoin News Today: Bitcoin Plummets Below $120,000 After U.S. Halts New Purchases

Bitcoin's price dropped below $120,000 on August 1, 2025, following a statement from U.S. Treasury official Adrienne “Bessent,” who indicated that the government would not make further purchases of the cryptocurrency. The comments came hours after Bitcoin reached an all-time high of $124,457, causing an immediate and sharp sell-off in the market [1]. The statement was delivered during an interview with Fox Business, where Bessent clarified that the U.S. would rely exclusively on confiscated assets to expand its Bitcoin reserves, rather than initiating new market purchases [1].

This stance represents a shift from earlier directives by President Donald Trump, who had encouraged budget-neutral strategies to grow the country’s Bitcoin holdings. In the months prior, the administration had explored unconventional funding mechanisms, including using tariff revenue and reassessing the value of gold certificates to finance additional acquisitions. Bessent’s comments effectively paused those efforts — at least temporarily [1].

Despite the negative market reaction, Bessent emphasized that the U.S. has no intention of liquidating its existing Bitcoin holdings, which he estimated to be worth between $15 billion and $20 billion at current prices. White House digital asset adviser David Sacks had previously characterized the reserve as a “digital Fort Knox,” underscoring its role as a long-term store of value [1].

The price decline occurred amid broader macroeconomic uncertainties and anticipation of key U.S. inflation data. Bitcoin continued to retreat over the following days, settling below $119,000 on August 12 as the overall crypto market cap dipped under $4 trillion [2]. Analysts attributed the pullback to speculative positioning and a lack of fresh catalysts, particularly with the removal of the bullish narrative tied to potential U.S. government purchases [2].

The price action also reflected broader pressures on the U.S. dollar, which drifted amid political and economic uncertainties. The market remains focused on upcoming Federal Reserve decisions and labor market reports, both of which are expected to influence Bitcoin’s performance [4]. Earlier in the month, Bitcoin had benefited from favorable macroeconomic tailwinds, including expectations of Federal Reserve rate cuts and growing institutional adoption [3]. However, without continued government-backed accumulation, the market is left to navigate a more uncertain landscape.

Bitcoin’s movements in early August highlight the asset’s responsiveness to institutional and government signals, despite growing interest from both retail and institutional investors. While the immediate outlook appears bearish, the potential for renewed momentum will depend on developments in U.S. monetary policy and broader economic trends [4].