After Bessent confirmed that the U.S. would not purchase more Bitcoin, the price of Bitcoin dropped significantly.
The price of Bitcoin, the leading cryptocurrency by market capitalization, fell sharply earlier this Thursday after U.S. Treasury Secretary Scott Bessent confirmed that the U.S. would not purchase cryptocurrencies as part of its strategic reserves.
At 12:35 UTC, the leading cryptocurrency plummeted to an intraday low of $117,719 on the Bitstamp exchange. The currency pair is currently struggling to recover, priced at $118,544.
Bitcoin fell nearly 4% on the same day it hit a historic high of $124,517.
$1 billion worth of liquidations
Altcoins have been hit harder, with XRP plummeting 7% in minutes, briefly falling below $3.
CoinGlass data shows that over $1 billion worth of cryptocurrencies were liquidated in the past 24 hours.
Among them, long positions account for the vast majority ($778 million).
Reserve odds plummet
Bessent stated that the U.S. will stop selling its existing currency, which has been the policy of the current government since establishing cryptocurrency reserves in March.
However, he had previously hinted that it might be possible to purchase more Bitcoin through some avenues, but he has now clearly ruled out the possibility of buying new Bitcoin.
On the major cryptocurrency BC platform Polymarket, the probability of the U.S. establishing its strategic Bitcoin reserves by 2025 has now plummeted to just 16%, a historic low.
Bitcoin worth up to $20 billion
Bessent clarified that the government's holdings of Bitcoin (including seized Bitcoin) currently amount to $20 billion. This makes the country the largest holder of Bitcoin among all nations.
According to BitTBO data, China and the UK also rank in the top three. However, according to U.Today, China is considering selling its large Bitcoin holdings, which would help the current Labour government fill the budget gap.
