Following Trump’s bitcoin reserve plan, volatility persists, as Bitcoin drops as high as 6.5 percent

Following President Donald Trump’s executive order to establish a strategic bitcoin reserve for the US, the price of the biggest cryptocurrency in the world continued to fluctuate on Monday.

Bitcoin prices dropped as much as 6.5% earlier Monday, trading at about $80,650 before reversing the majority of their losses. currency Metrics reports that the currency was down 0.74% at $82,050 at 4:12 a.m.

The U.S. government has no intentions to purchase additional bitcoin; instead, the reserve will be financed by coins that have been taken in criminal and civil forfeiture cases. Crypto prices fell following last Thursday’s unveiling of the strategic reserve because investors were dissatisfied that a more aggressive program wasn’t offered.

The decision to create a reserve, however, was viewed as long-term bullish by some investors.

Matt Hougan, chief investment officer at Bitwise Asset Management, stated on Monday on CNBC’s “Squawk Box Asia” that “I firmly believe the market has this wrong.” He continued, “The market is short-term disappointed” that the government had not announced that it would begin buying 100,000 or 200,000 bitcoins right away.

The U.S. would seek “budget-neutral strategies for acquiring additional bitcoin, provided that those strategies have no incremental costs on American taxpayers,” according to White House Crypto and AI Czar David Sacks, who Hougan cited in remarks on X.

The appropriate issue, in my opinion, is whether this presidential order increased the likelihood that bitcoin would become a currency or asset of geopolitical significance in the future. Will other nations try to create their own strategic reserve, just like the United States? And the answer to that is definitely yes, in my opinion,” Hougan stated.

That question is important because it establishes whether bitcoin is worth $80,000 or $1 million per coin.”

Hougan referred to the drop in cryptocurrency values as a “short-term setback.”

He predicted that the market would quickly stabilize and recognize that the long-term outlook for this asset and cryptocurrency in general is extremely favorable.