August 14, 2025
5 min read
Mikaia ANDRIAMAHAZOARIMANANA
Scott Bessent ends Bitcoiners' dreams: The US government will not buy Bitcoin
The United States government has dampened the hopes of many Bitcoin supporters. Scott Bessent, Treasury Secretary, announced that there will be no new bitcoin purchases during the Trump administration. But what about BTC acquisitions? This alternative would have satisfied many advocates of the flagship cryptocurrency, such as Senator Cynthia Lummis or investor Michael Saylor. Will the US government stay out of one of the most prominent investments of the moment?In brief
- Scott Bessent announces a freeze on bitcoin purchases for the United States.
- The US Bitcoin reserve will only be fed by seized assets.
- The crypto market reacted sharply, with BTC falling below 119,000 USD.
- The United States prefers a strategy of reducing their deficit through tax revenues, not bitcoin.
- The US government has stopped its bitcoin purchases to focus on seized assets;
- The bitcoin price reached a historic peak of 124,457 USD before dropping to 119,000 USD following Bessent’s statements;
- The US bitcoin reserve is estimated between 15 and 20 billion USD but will no longer be fed by direct purchases;
- Tariffs should generate 300 billion USD in 2024, an alternative to bitcoin purchases for deficit reduction. While the US opts for caution, other countries like El Salvador, Norway, and Pakistan are not hesitating to invest in bitcoin. The queen of cryptos thus establishes itself as an alternative to traditional currencies. These countries make crypto a pillar of their economic policy, while others, like France, remain more reserved.
- What is Bitcoin? A Comprehensive Beginner's Guide
- Understanding the Global Crypto Regulatory Landscape
- The Impact of Tariffs on the Global Economy
The freeze on Bitcoin purchases: an unexpected strategic choice
On August 14, during his appearance on Fox Business, Scott Bessent confirmed what many feared: the US government will not make new bitcoin purchases. This announcement, made after several months of speculation and public statements, came as a surprise. Bitcoiners had hoped for a nationalized bitcoin reserve akin to a traditional central bank holding gold or dollar reserves. However, Bessent specified that the US strategic BTC reserve will only be replenished by assets seized by the courts. “We will use seized assets and continue to accumulate them,” he added, explaining that bitcoin will no longer be purchased but only stored following legal seizures. This decision ends the ambitions of those who dreamed of a major government maneuver to increase the BTC reserve. The crypto market reacted quickly: bitcoin, which had reached a historic peak of 124,457 USD, dropped below 119,000 USD within hours. The US government’s decision not only impacted the crypto market but also the perception of bitcoin as a reserve currency. BTCUSD chart by TradingViewA budget strategy: when inflation meets digital reserves
The halt in bitcoin purchases does not mean the US government is completely disengaging from cryptocurrencies. According to Bessent, the United States will continue to use seized bitcoins to enlarge the national reserve, currently estimated between 15 and 20 billion USD. This model resembles a passive accumulation strategy, where the government does not seek to speculate but to store these assets for crisis management purposes. In an economic context where the US public debt has surpassed 37 trillion USD, bitcoin reserves could play a crucial role as a safe-haven asset. Other players, like Michael Saylor, see bitcoin as an opportunity for nations to shield themselves against inflation. But US caution shows another side of financial management. While the US bitcoin reserve remains static, the administration is exploring alternatives like increasing tax revenues, notably through tariffs, expected to reach 300 billion USD in 2024. Although this approach alleviates deficit pressure, it does not address rampant inflation and currency devaluation risks. Despite the US administration’s cautious stance, influential voices continue to defend bitcoin as a solution to these global economic challenges.Bitcoin in the geopolitical framework: An asset or a mirage for America?
In a world where cryptocurrencies are rapidly developing, could bitcoin become a geopolitical tool for the United States? The crypto industry is booming, and the US, although reticent on direct bitcoin purchases, already holds significant reserves of seized digital assets. The Donald Trump administration initially considered acquiring bitcoins through budget-neutral strategies, but the halt in purchases seems to mark a desire not to enter the race for large-scale digital reserves. In this context, cryptocurrencies, especially bitcoin, become a major issue against rivals like China. Indeed, asset decentralization strategies could allow countries like the US to position themselves more strategically against geopolitical adversaries. However, without an active purchase plan, bitcoin still seems to be perceived as a limited asset on the world stage. Although bitcoin can offer an alternative to more traditional assets, like gold or fiat currencies, crypto market volatility represents a potential risk for the US. By avoiding massive BTC purchases, the government protects itself from unpredictable cryptocurrency fluctuations. Bitcoin, in this view, remains an unreliable asset for a country whose economic stability relies on solid and more traditional reserves.Key facts:
Frequently Asked Questions (FAQ)
US Government Bitcoin Policy
Q: Did the US government announce it would buy Bitcoin? A: No, Scott Bessent, Treasury Secretary, announced that the US government will not be making new bitcoin purchases. Q: How will the US government's Bitcoin reserve be replenished? A: The US Bitcoin reserve will solely be replenished by assets seized through legal processes. Q: What was the market reaction to this announcement? A: The crypto market reacted sharply, with Bitcoin's price dropping below $119,000 USD shortly after the announcement. Q: What is the US government's stated strategy for deficit reduction instead of Bitcoin purchases? A: The US government prefers to reduce its deficit through increasing tax revenues, such as through tariffs, which are expected to generate $300 billion USD in 2024. Q: Does this mean the US is exiting the cryptocurrency space entirely? A: No, the announcement clarifies that the US will continue to hold and accumulate seized Bitcoin, indicating an ongoing, albeit passive, involvement.Bitcoin as a Reserve Asset
Q: Why might governments consider holding Bitcoin? A: Some advocates, like Michael Saylor, believe Bitcoin can serve as a hedge against inflation and a store of value for nations. Q: What are the perceived risks of government Bitcoin holdings? A: The volatility of cryptocurrency markets presents a potential risk, which the US government appears to be mitigating by avoiding large-scale direct purchases. Q: How does this US government decision compare to other countries' actions? A: While the US is adopting a cautious approach, countries like El Salvador and Norway have actively invested in Bitcoin, highlighting differing national strategies for digital assets.Crypto Market AI's Take
The decision by the US government, as articulated by Scott Bessent, to halt direct Bitcoin purchases marks a significant moment in the ongoing conversation about cryptocurrency's role in national treasuries. While this move may disappoint Bitcoin maximalists who envisioned a substantial government-backed BTC reserve, it underscores a preference for fiscal prudence and revenue generation through traditional means. This strategy, focusing on seized assets, aligns with a more conservative approach to digital assets, prioritizing risk mitigation over aggressive accumulation. The market's reaction, though immediate, is part of the broader narrative of Bitcoin's price sensitivity to major institutional and governmental signals. Our platform's AI analysis indicates that while direct government purchasing might be off the table for the US in this administration, the accumulation of seized assets could still contribute to the overall scarcity narrative surrounding Bitcoin. Understanding these nuanced policy shifts is crucial for navigating the evolving crypto landscape. For deeper insights into how AI can help manage market volatility and identify strategic investment opportunities, explore our resources on AI-driven trading strategies and market analysis.More to Read:
Source: Originally published at Cointribune on Thu, 14 Aug 2025 18:48:41 GMT