On March 7, 2025, the Trump administration unveiled its Bitcoin strategic reserve directive, yet the market failed to deliver the anticipated sharp rally, instead experiencing a pullback.
Peter Chung, Research Director at Presto Research, observed that Bitcoin (BTC) did not exhibit parabolic growth within an hour of the directive’s release, with prices instead declining modestly. He explained, “This points to a classic ‘buy the rumor, sell the news’ dynamic. Investors built positions during the rumor phase, but the official announcement failed to further fuel sentiment.”
Data supports this: BTC trading volume surged 12% in the 24 hours leading up to the release, signaling speculative inflows. However, within an hour of the announcement, prices dropped approximately 3% from their peak, reflecting incomplete market digestion of the news. Chung forecasted, “In the coming hours, the tug-of-war between bulls and bears will likely dominate, potentially amplifying volatility.”
Policy Details Trigger Expectation Gap
Nick Ruck, Research Head at LVRG Research, attributed the subdued response to the directive’s “conservative” nature. He noted, “Traders expected the government to directly purchase Bitcoin with fiscal allocations, creating substantial buying pressure. Instead, officials clarified that the reserve would rely solely on Bitcoin seized from criminal and civil cases, not fresh capital injections.”
According to U.S. Department of Justice data, seized crypto assets in 2024 comprised roughly 65% Bitcoin, valued at approximately $2 billion. If this serves as a baseline, the reserve’s scale falls far short of the “hundreds of billions” some had projected. This gap in expectations diluted short-term bullish momentum, prompting some investors to sell off and adding downward pressure. Ruck elaborated, “This isn’t a dismissal of Bitcoin’s value but a reassessment of the policy’s strength.”
Despite the tepid initial reaction, Presto’s Chung highlighted a key area for scrutiny: “The directive’s long-term impact hinges on subsequent details.” He recommended monitoring two elements: first, whether the U.S. will outline a “budget-neutral” approach to bolster the reserve, such as through tax credits or asset swaps to acquire more Bitcoin; second, how seized non-BTC assets (e.g., ETH or USDT) will be managed—potentially converted into Bitcoin to refine the reserve structure.
Using current seizure figures as a reference, converting non-BTC assets could increase the reserve by $500 million to $1 billion annually. If legislatively entrenched, this mechanism could offer a consistent demand signal for the market. Chung stressed, “The disclosure of these specifics will be crucial in gauging the policy’s depth.”
Macro Perspective: Strategic Reserve’s Global Financial Significance
From a wider vantage point, the Bitcoin strategic reserve extends beyond economic policy, potentially emerging as a geopolitical financial instrument. Should the U.S. pioneer BTC as a national reserve asset, it could cement its role as “digital gold,” spurring imitation by other nations. Per Bank for International Settlements (BIS) data, global central banks added 800 tons to gold reserves in 2024, and Bitcoin’s scarcity (capped at 21 million coins) positions it as a parallel option. If this trend takes hold, it could reshape the global valuation logic for cryptocurrencies.