The price of Bitcoin, the leading cryptocurrency by market capitalization, collapsed sharply lower earlier this Thursday after U.S. Treasury Secretary Scott Bessent confirmed that the U.S. would not be buying crypto for its strategic reserve.
At 12:35 UTC, the leading cryptocurrency sharply plunged to an intraday low of $117,719 on the Bitstamp exchange. It is struggling to regain ground, currently at $118,544.
Bitcoin is down nearly 4% on the same day it reached a new all-time high of $124,517.
$1 billion worth of liquidations
Altcoins have taken an even bigger hit, with XRP plunging by 7% within minutes, briefly dipping below the $3 level.
Overall, more than $1 billion worth of crypto has been liquidated over the past 24 hours, CoinGlass data shows. Long positions account for the overwhelming majority of this wipeout ($778 million).
Collapsing reserve odds
Bessent has stated that the U.S. will stop selling existing coins, which has been the policy of the current administration since the establishment of the cryptocurrency reserve in March.
However, he has now explicitly ruled out new Bitcoin purchases after previously suggesting that some avenues could be found for buying more.
On Polymarket, the main cryptocurrency-based betting platform, the odds of the U.S. establishing its own strategic Bitcoin reserve in 2025 have now collapsed to just 16%, which is a new all-time low.
Up to $20 billion worth of Bitcoin
Bessent has clarified that the government's holdings, which are comprised of confiscated coins, currently stand at up to $20 billion. This makes it the largest holder of the top cryptocurrency among all countries.
According to BitTBO data, China and the UK are also in the top 3. However, as reported by U.Today, the former is considering selling its vast Bitcoin holdings, which would help the current Labour government to fill a budget hole.
Dan Burgin
Vladislav Sopov
U.Today Editorial Team