President Trump just signed an executive order creating a strategic Bitcoin and crypto reserve, triggering a “sell the news” event and an abrupt $5,000 drop in the price of BTC.

BTC fell from $90,251 to $85,091 in less than an hour after Trump signed the order, which establishes a national Bitcoin and crypto stockpile by holding digital assets seized from criminal activities rather than auctioning them off as had been previous practice.

BTC has since recovered to $87,202 at time of publishing.

The move had been widely anticipated and confirmed the executive action will not actively push the US to purchase crypto assets.

White House artificial intelligence and crypto czar David Sacks released a statement on the signing.

“Just a few minutes ago, President Trump signed an Executive Order to establish a Strategic Bitcoin Reserve.

The Reserve will be capitalized with Bitcoin owned by the federal government that was forfeited as part of criminal or civil asset forfeiture proceedings. This means it will not cost taxpayers a dime.

It is estimated that the U.S. government owns about 200,000 bitcoin; however, there has never been a complete audit. The E.O. directs a full accounting of the federal government’s digital asset holdings.

The U.S. will not sell any bitcoin deposited into the Reserve. It will be kept as a store of value. The Reserve is like a digital Fort Knox for the cryptocurrency often called “digital gold.”

Premature sales of bitcoin have already cost U.S. taxpayers over $17 billion in lost value. Now the federal government will have a strategy to maximize the value of its holdings.

The Secretaries of Treasury and Commerce are authorized to develop budget-neutral strategies for acquiring additional bitcoin, provided that those strategies have no incremental costs on American taxpayers.

IN ADDITION, the Executive Order establishes a U.S. Digital Asset Stockpile, consisting of digital assets other than bitcoin forfeited in criminal or civil proceedings.

The government will not acquire additional assets for the Stockpile beyond those obtained through forfeiture proceedings.

The purpose of the Stockpile is responsible stewardship of the government’s digital assets under the Treasury Department.

PROMISES MADE, PROMISES KEPT

President Trump promised to create a Strategic Bitcoin Reserve and Digital Asset Stockpile. Those promises have been kept.

This Executive Order underscores President Trump’s commitment to making the U.S. the “crypto capital of the world.”

I want to thank the President for his leadership and vision in supporting this cutting-edge technology and for his rapid execution in supporting the digital asset industry. His administration is truly moving at ‘tech speed.’

I also want to thank the President’s Working Group on Digital Asset Markets — especially Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick — for their help and support in getting this done. Finally Bo Hines played a critical role as Executive Director of our Working Group.”

Bitcoin’s price move has partially retraced a major jump triggered in large part by Trump’s pro-crypto stance.

After Trump first announced the strategic Bitcoin reserve during his campaign and won the election on November 5th, BTC surged from around $65,000 to a peak of $108,268 on December 17th.

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There are signs of growing optimism in the market as the stablecoin reserve on the Binance exchange has jumped to a new all-time high (ATH). According to CryptoQuant analyst Darkfrost, this increase in the Binance stablecoin reserve marks a good omen for a positive market rebound. With volatility swaying the market in recent times, it remains to be seen what direction Bitcoin and altcoins will take moving forward.

Binance Stablecoin Reserve and Market Shift

Per the CryptoQuant data, the ERC-20 stablecoin on Binance has surpassed the $31.3 billion threshold. Darkfrost noted that a bump in the Binance stablecoin reserve often indicates positive momentum. 

The CryptoQuant analyst attributed the massive Binance stablecoin inflow to two major reasons. These include channeling liquidity into the top crypto trading exchange in preparation for potential market entry. According to Darkfrost, this trend reflects confidence in the market and the exchange.

Beyond the influence of third-party investors, Binance could also be consolidating its stablecoin reserve amid a boost in market demand. The stablecoin reserve, per the chart shared by Darkfrost, has been on an upward trend since July 2024. The previous peak recorded onchain came around December 2022.

Binance Stablecoin Implication for Bitcoin

As the CryptoQuant analyst noted, periods of positive shift in the asset’s reserve often come with a massive push in the price of Bitcoin.

“Historically, periods of rising stablecoin reserves on Binance have often coincided with, or even preceded, an increase in BTC prices and a broader upswing in the crypto market,” Darkfrost said in his note.

The market has been quite unstable in the past few weeks, with volatility defining the order. At the time of writing, Bitcoin was changing hands for $90,511.91, up marginally by 0.18% in 24 hours.

Bitcoin price entered a risky zone earlier as Crypto Czar David Sacks blamed the Biden administration for selling BTC too early. This Bitcoin sentiment and uncertainty around the forthcoming White House Digital Asset Summit fuels market drawdown.

Market Dynamics and Trends to Watch

While the Binance exchange has enjoyed dominance in trading volume, including the stablecoin market, the trend is set to change. Based on the Markets In Crypto Asset (MiCA) legislation, the exchange has set March 31 to delist non-MiCA compliant tokens.

Some ERC-20 tokens, including USDT and EURI, will stop trading on the exchange. This might impact the exchange’s growing stablecoin reserve, which may, in turn, impact the broader market dynamics, as Darkfrost teased.

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Godfrey Benjamin

Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.

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Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.