Bitcoin Plunges as US Strategic Reserve Hopes Fade

Bitcoin (BTC) prices dipped below the $95,000 mark on Tuesday, marking a significant decline from its all-time high of $109,200 reached four weeks ago. This sharp fall has raised concerns among investors, particularly as the likelihood of a Strategic Bitcoin Reserve (SBR) in the US appears to be decreasing.

The uncertainty surrounding an SBR began when a Polymarket poll, with over $6.9 million in assets, suggested a 12% chance that Donald Trump would create an SBR within his first 100 days in office. However, the odds have been declining since January, when they peaked at 40%. Another poll, currently active, indicates a 38% chance of the Strategic Bitcoin Reserve Act being signed by 2025, down from an initial 60%.

Despite the decreasing odds, several states, including Wyoming, Alabama, Florida, Arizona, and Wisconsin, are considering establishing SBRs. David Sacks, a venture capitalist turned politician, is reportedly leading the efforts to create a strategic Bitcoin reserve under the new administration. Rumors suggest that Sacks may initiate this process using seized BTC tokens held by the US government, which currently amounts to approximately 198,109 BTC, valued at $18 billion.

If the US government were to establish an SBR, it could potentially encourage other nations, such as China and Britain, to follow suit. This would make BTC a global digital asset backed by governments, further solidifying its status in the international financial landscape.