Trump Order Sparks Bitcoin Drop 4.8% Ethereum Falls 8% Amid Trade Tariff Fears
1min read The cryptocurrency market is currently experiencing a downturn as traders react to President Trump’s recent Executive Order regarding the Strategic Bitcoin Reserve and escalating U.S. trade tariffs. Bitcoin has fallen approximately 4.8%, trading at around $81,729, while Ethereum’s value has decreased by 8%, settling slightly above the $2,000 mark, raising concerns about the overall health of digital assets.
According to QCP Capital, the immediate drop in value likely stems from the realization that no actual budget has been allocated for Bitcoin purchases in the near term. This lack of immediate financial commitment has led to skepticism among investors, further exacerbated by the recent wave of U.S. trade tariffs, which are causing broader market uncertainties.
The Executive Order mandates the Department of Treasury and the Department of Commerce to develop budget-neutral strategies for acquiring Bitcoin. However, the order notably lacks any allocation of taxpayer funds for purchasing Bitcoin on the open market, which has led to doubts among investors. David Lawant from FalconX pointed out that the immediate drop post-announcement indicates a lack of confidence in the government’s active involvement in acquiring digital assets.
Despite the initial market reactions, some analysts see this Executive Order as a critical step towards institutional acceptance of Bitcoin. The order articulates a framework for a Bitcoin reserve that is separate from the broader Digital Asset Stockpile, which will include altcoins, such as Ethereum. Currently, U.S. government wallets hold approximately 198,000 BTC, valued at nearly $16.1 billion, much of which has been seized from criminal activities. The challenge remains on how much of these seized assets will be allocated to the new reserve.
While the Executive Order serves to set a preliminary policy, any permanent establishment of a Bitcoin reserve would likely require action from Congress. The forthcoming Bitcoin for America event on March 11, hosted by Senator Cynthia Lummis, is expected to play a pivotal role in discussions regarding legislative strategies for Bitcoin acquisition and long-term policy integration.
As traders navigate these developments, the broader impact of Trump’s trade tariffs on global market sentiments cannot be overlooked. With escalating tensions influencing risk assets, including cryptocurrencies, investors may remain cautious while awaiting further clarification on regulatory frameworks. This snapshot of market dynamics showcases a complex interplay between government action and investor sentiment in the cryptocurrency realm.
