Bitcoin drops after Trump signs executive order on crypto and ‘national digital asset stockpile’

On Jan. 23, President Trump signed an executive order creating a working group on digital asset markets tasked with finding ways to give the US leadership in the crypto industry, along with “evaluating the creation of a strategic national digital assets stockpile.” 

While the executive order is a step forward for the crypto sector, it falls short of the national strategic Bitcoin reserve-specific executive order that BTC investors have been anxiously waiting for. Minutes after the executive order was signed, BTC (BTC) responded by trending down, briefly falling to $102,220. 

This downside move pales in comparison to the exuberance seen in BTC price earlier in the day when US Senator and pro-Bitcoin advocate Cynthia Lummis posted on X that “Big things are coming,” encouraging her followers to “stay tuned” for an announcement which many assumed would be a presidential executive order to for the formation of a strategic Bitcoin reserve. 

Following Lummis’ social post, Bitcoin abruptly rallied from $102,100 to $106,850 before the market realized that the Senator was actually referring to her appointment as the chair of the Senate Banking Subcommittee on Digital Assets. 

The softening of Bitcoin price is partially connected to market participants reading the fine print of the executive order and possibly realizing that a BTC-only national strategic reserve simply cannot be created in one day by the stroke of a pen. 

Specific language within the executive order says that, 

“(ii) The Working Group shall evaluate the potential creation and maintenance of a national digital asset stockpile and propose criteria for establishing such a stockpile, potentially derived from cryptocurrencies lawfully seized by the Federal Government through its law enforcement efforts.” 

Despite the lack of an immediate bullish response to the crypto-specific executive order, thought leaders and major investors in the sector lauded the news as a paradigm shift toward Bitcoin mass adoption. 

Related: Bitcoin chart shows ‘diamond pattern’ with $96K target — What will kick off the downside?

Within the crypto markets, buying the rumor and selling the news is common practice and perhaps Bitcoin’s price action after President Trump’s executive order is in line with this trend. Crypto analyst Will Clementee III shared this sentiment while also encouraging traders to remain patient and positive. 

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.