Bitcoin (BTC) and Ethereum (ETH) Slipped as President Trump's Executive Order to Create a Strategic Bitcoin Reserve Became a "Sell-the-news" Event

The leading cryptocurrency dropped from $90,000 to $84,979 in 40 minutes after the news became public before recovering to $86,000 as traders bought the dip.

Leading cryptocurrencies slipped on Thursday as President Donald Trump's executive order to create a strategic Bitcoin reserve became a "sell-the-news" event, while a broader correction in the stock market also impacted market sentiment.

What Happened: The flagship cryptocurrency dropped from $90,000 to $84,979 in 40 minutes after the news broke before recovering to $86,000 as traders bought the dip.

Ethereum (CRYPTO: ETH), the second-largest cryptocurrency, also fell to $2,100 after hitting an intraday high of $2,319.40.

The declines came as Trump signed an executive order establishing a Bitcoin reserve and a digital asset stockpile of other cryptocurrencies, both funded by forfeited assets held by the U.S. government. While the government may acquire additional Bitcoin, no extra purchases will be made for the digital stockpile.

The order directs agencies, including the Treasury Department and the Federal Reserve, to cooperate on a coordinated strategy for introducing new digital assets into the government's portfolio.

"This directs relevant agencies to prioritize the efficient use of forfeited digital assets to maximize the return to the American people," the White House said in a statement.

The executive order also calls for a report on the potential impact of a U.S. central bank digital currency (CBDC).

The global cryptocurrency market cap now stands at $2.82 trillion, showing a 4.55% decrease in the last 24 hours.

Crypto traders liquidated $537 million from the cryptocurrency market in the last 24 hours, with $111 million liquidated in the last hour alone.

Bitcoin's Open Interest fell 2.58% in the last 24 hours, while the percentage of traders positioned short on the apex cryptocurrency increased to 51%.

Meanwhile, the Crypto Fear and Greed Index improved from "Extreme Fear" to "Fear" as of this writing.

Top Gainers (24 Hours)

The global cryptocurrency market cap now stands at $2.82 trillion, showing a 3.57% increase in the last 24 hours.

Following a brief reprieve, stocks resumed their correction on Thursday. The Dow Jones Industrial Average dipped 427.51 points, or 0.99%, to close at 42,579.08. The S&P 500 slipped 1.78%, ending at 5,738.52, while the tech-heavy Nasdaq Composite tumbled 2.61% to close the session at 18,069.26.

The selling came despite Trump postponing the enforcement of a 25% tariff on most Mexico imports for a month. The administration's trade measures and retaliatory action by key partners have rattled markets over the last month.

See More: Best Cryptocurrency Scanners

Analyst Notes: Long-term holders of Bitcoin have taken advantage of the ongoing correction to fill their bags, according to widely followed cryptocurrency analyst, Ali Martinez.

"Long-term holders are accumulating! The supply held by long-term holders has increased by 85,000 BTC in the past month," Martinez said.

For Ethereum, Martinez highlighted the significance of $2,200.

"As long as ETH stays above $2,200, the odds of a rebound increase, especially with the TD Sequential flashing a buy signal on the weekly chart in the form of an A13!" he remarked.

Well-known blockchain analytics firm CryptoQuant noted that stablecoin reserves on cryptocurrency exchange Binance have hit a new high.

"Historically, periods of rising stablecoin reserves on Binance have often coincided with, or even preceded, an increase in BTC prices and a broader upswing in the crypto market," the firm stated.

"When we observe an increase in stablecoin reserves on Binance—currently the exchange with the highest trading volumes—it indicates a positive momentum, as traders appear to be accumulating stablecoins in anticipation of further market moves."

See More: Bitcoin Price Prediction: A Long-Term Bullish Case For The World's Largest Cryptocurrency