Last week, the Bitcoin market continued to experience strong fluctuations as President Donald Trump officially signed a decree to establish the U.S. Bitcoin Reserve Fund. However, instead of creating upward momentum, Bitcoin was negatively impacted by economic instability, causing the price to drop sharply.
Trump Establishes Bitcoin Reserve Fund – Why is the Price Dropping?
On Thursday, President $TRUMP officially signed a decree establishing the strategic Bitcoin reserve fund, fulfilling a campaign commitment. Accordingly, this fund will hold nearly 200,000 BTC that the U.S. government has previously seized. At the same time, the decree also proposes strategies to accumulate more Bitcoin in a way that does not affect the national budget.
However, instead of pushing the Bitcoin price higher, the market reacted negatively. Over the past week, Bitcoin continuously fluctuated in the range of 94,770 USD - 82,681 USD and is currently trading around 85,925 USD, with an increase of less than 1% over the past 7 days (data from CoinGecko).
The main reason for this price drop may come from investors 'selling on the news'. When Trump announced the Bitcoin reserve plan on Sunday, BTC prices surged. But after the official information was released on Thursday, many investors took profits, causing prices to tumble.
Bitcoin ETF Bleeds – Withdraws 740 Million USD in a Week
Alongside the decline of Bitcoin, funds #ETFbitcoin in the U.S. also recorded a strong outflow. Friday was the worst day of the week as ETF funds faced a net withdrawal of 409 million USD, bringing the total withdrawals for the week to 740 million USD (data from Farside Investors).
Nevertheless, this figure is still better than the previous week when Bitcoin ETF funds experienced the worst day in history. It remains unclear when cash flows will return, as investor sentiment is still affected by tariff policies and Trump’s Bitcoin reserve.
Is Trump Selling Gold to Buy Bitcoin? Not at This Time
Although the U.S. government has established a Bitcoin reserve fund, the biggest question remains: Will the Trump administration sell gold to buy more BTC?
David Sacks, White House Crypto Advisor, stated that there are currently no plans to sell gold to buy Bitcoin. However, he also revealed that the Treasury and Commerce Departments will soon discuss ways to accumulate more Bitcoin without affecting taxpayers.
This indicates that the U.S. may continue to buy more Bitcoin, but will apply smarter strategies instead of selling gold immediately.
Texas Moves Closer to Establishing Its Own Bitcoin Fund
Not only the federal government, Texas is also promoting its own Bitcoin reserve plan. The Texas Senate approved bill SB21 on Thursday to establish a state-managed Bitcoin investment fund.
This bill is similar to H.B. No. 1598 proposed last year, but with one major difference:
If approved, the Bitcoin fund #Texas could flexibly invest in other cryptocurrencies besides BTC, taking advantage of opportunities in the crypto market.
Currently, SB21 is awaiting a vote in the Texas House of Representatives. If passed, Texas will become one of the pioneering states in reserving and investing in cryptocurrency.
Summary: Bitcoin Remains Highly Volatile
Although Trump has officially established the Bitcoin reserve fund, the market remains unstable due to macro factors such as tariff policies and capital withdrawals from ETF funds. Meanwhile, Texas is getting closer to managing crypto assets at the state level, opening a new chapter in the Bitcoin game in the U.S.
Will the Bitcoin price continue to face pressure or is this just a temporary adjustment before a new price increase? Let's wait for the next developments!