Bitcoin News Today: Bitcoin Plummets 5.1% to $117,763 After Treasury Official Rules Out New Strategic Reserve Purchases

Bitcoin fell to $117,763 on July 25, 2025, as uncertainty spread in the market following U.S. Treasury Secretary Scott Bessent’s statement that the government would not purchase additional Bitcoin for a strategic reserve [1]. The remarks, made during an interview with Fox Business, directly contradicted earlier expectations fueled by President Donald Trump’s July executive order establishing a U.S. Strategic Bitcoin Reserve, which had briefly pushed Bitcoin to an all-time high of $124,128 [2]. Bessent clarified that while the government would not be acquiring more Bitcoin, it would continue to hold and expand its current holdings through future asset seizures, estimating the value of its existing stash at between $15 billion and $20 billion at current prices [1].

The market reaction was swift and severe. Bitcoin dropped below the key psychological threshold of $120,000 and traded at $117,763 within 24 hours [1]. The decline was exacerbated by the same day’s Producer Price Index (PPI) report, which showed a 0.9% increase, far exceeding expectations of 0.2%. The dual blow from policy and economic data triggered a broad-based sell-off across the crypto market. Ether (ETH) fell nearly 4% to $4,544, while other high-performing altcoins like XRP and SOL also declined [1].

The shift in sentiment highlighted the fragility of investor confidence in the face of changing government narratives. Earlier in the month, the executive order had sparked optimism in both spot and derivatives markets, with volatility skews shifting toward out-of-the-money calls and positive funding rates in futures contracts [2]. However, the Treasury’s clarification that no new purchases were planned led to an immediate reversal, with Bitcoin consolidating between $115,000 and $120,000. The failure to break above $120,000 signaled a lack of sustained demand and raised questions about the strategic value of Bitcoin in institutional portfolios [1].

Bessent’s remarks also introduced new uncertainty into the broader regulatory landscape. While the U.S. Congress had recently passed several crypto-related bills—such as the GENIUS Act, CLARITY Act, and CBDC Anti-Surveillance State Act—these developments were seen as steps toward institutional acceptance of digital assets [1]. Bessent’s stance, however, suggested that government officials remained cautious about the role of Bitcoin in strategic planning, even as they advanced other crypto-friendly policies. The Treasury’s decision not to include Bitcoin in a strategic reserve underscored the ongoing tension between innovation and financial stability in the U.S. government’s approach to digital assets [1].

The immediate aftermath of the announcement saw a sharp shift in derivatives markets. Bitcoin’s volatility term structure inverted, and options skews moved toward put options, reflecting increased demand for downside protection [1]. While Ethereum continued to show strength, with spot prices reaching $3,800 and the total crypto market cap surpassing $4 trillion, the broader market environment remained under pressure from geopolitical tensions, inflationary concerns, and regulatory uncertainties [2].

The episode once again illustrated the outsized influence of U.S. policymakers on crypto markets. While Trump’s administration has taken a pro-crypto stance, including the appointment of crypto-friendly regulators and support for ETF approvals, the Treasury’s clarification revealed lingering caution regarding the asset’s volatility and speculative nature. The decision to exclude Bitcoin from a strategic reserve, despite earlier executive orders suggesting otherwise, emphasized the challenge of balancing innovation with fiscal responsibility [1].

In conclusion, the sharp decline in Bitcoin’s price to $117,763 followed a key policy clarification by U.S. Treasury Secretary Bessent, who stated that the government would not buy additional Bitcoin for a strategic reserve. The announcement reflected a government preference for holding seized assets over active purchases and contributed to a broader market correction. The episode underscores the continuing sensitivity of crypto markets to U.S. regulatory and policy developments, even as institutional adoption continues to evolve.

Source:

[1] Block Scholes x Bybit Crypto Derivatives July 25 2025

[2] Block Scholes x Bybit Crypto Derivatives July 16 2025

[3] Block Scholes x Bybit Crypto Derivatives July 10 2025

[4] Bybit x Block Scholes Institution Report: Drivers and Sentiments Behind Ether’s Recent Breakout and How Far It Can Go