Bitcoin (BTC) Price Drops 5.6% to $84,979 as President Donald Trump's Executive Order to Create a Strategic Bitcoin Reserve Becomes a "Sell-the-news" Event

Leading cryptocurrencies slipped on Thursday as President Donald Trump's executive order to create a strategic Bitcoin reserve became a "sell-the-news" event.

President Donald Trump’s executive order to create a strategic Bitcoin reserve and a digital asset stockpile of other cryptocurrencies, both funded by forfeited assets, had a dampening effect on crypto prices on Thursday.

The apex 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.

The second-largest cryptocurrency, slid to $2,100 after an intraday high of $2,319.40. The fall came after 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 for the digital stockpile will be made.

The move comes amid heightened government scrutiny of the cryptocurrency sector. Earlier this week, the U.S. Securities and Exchange Commission sued major cryptocurrency exchange Binance for operating without registration and handling securities.

The world’s cryptocurrency behemoth had announced on Wednesday that it would cease offering spot cryptocurrency trading services to U.S. users by March 2025. The move came after the SEC sued Binance for allegedly defrauding investors.

About $537 million was liquidated 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” at last glance.

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

In other market news, stocks resumed their correction on Thursday as Trump’s move to postpone the enforcement of a 25% tariff on most Mexico imports for a month failed to provide complete respite to traders.

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.

The administration had threatened to impose the tariffs from June 10 to pressure Mexico into halting the Central American migrant crisis. However, the White House announced that the tariffs would be postponed for one month.

“We have reached an agreement in principle and we will be able to cancel the tariffs. They will not be necessary,” Trump said at the White House.

The president added that he would be meeting with Mexican President Andres Manuel Lopez Obrador next week to continue discussing the issue.

The administration's decision came as a relief to investors, who had been anticipating the tariffs with trepidation. The tariffs would have affected a wide range of goods, including food, cars, and textiles.