Bitcoin dropped 6.5% following the US strategic reserve announcement, causing market volatility.
Reserve Announcement
US President Donald Trump signed an executive order to establish a strategic Bitcoin reserve, funded by BTC seized in criminal and civil cases. Notably, the government has no plans to purchase additional BTC directly.
Market Reaction and Expert Opinions
Crypto markets reacted negatively to the news, with investors expressing disappointment over the lack of a more aggressive savings strategy. However, some analysts believe this could have long-term positive effects on Bitcoin. David Sacks, White House Crypto and AI Chief, stated that the government would explore budget-neutral strategies to acquire Bitcoin at no additional cost to taxpayers.
Long-term Bitcoin Prospects
Despite the short-term price drop, Hougan remains optimistic about Bitcoin's long-term prospects. He suggests that such actions could drive the BTC price up to $1 million per coin. Hougan believes the market will soon recognize the long-term benefits of this initiative.
While the reserve announcement caused a short-term drop in Bitcoin's price, experts point to potential long-term benefits and impact on the cryptocurrency's market capitalization.
