August 15, 2025
5 min read
Luc Jose Adjinacou
Treasury Chief Backtracks After Market Panic
On August 14, ambiguous remarks by Treasury Secretary Scott Bessent triggered a sharp market reaction, wiping out tens of billions of dollars in capitalization within minutes. Investors feared an official renouncement of any Bitcoin acquisition by the US government, but a backpedal published hours later on the social platform X only added to the confusion surrounding the United States’ real strategy.In brief
- On August 14, an ambiguous statement by Scott Bessent caused a sharp drop in Bitcoin’s price.
- The U.S. Treasury stated it did not intend to buy Bitcoin, triggering market instability.
- A few hours later, Bessent reversed his remarks, assuring that purchases remain “budgetarily possible.”
- Criticism is mounting in the crypto ecosystem, denouncing lack of action and confusing communication.
- Bitcoin’s price dropped from $121,073 to $118,886 within 40 minutes.
- $55 billion in market capitalization was erased, according to CoinGecko data.
- The entire crypto market was affected by this unexpected statement. Aware of the impact of his remarks, Bessent attempted a partial backpedal hours later on X, stating:
- Bitcoin Price Surges Past $124,000 Amidst Strategic Reserve Discussions
- Understanding the U.S. Government's Growing Bitcoin Holdings
- Senator Lummis Advocates for the BITCOIN Act to Strengthen U.S. Reserves
A media appearance that sows confusion
The turmoil began with an interview given by Treasury Secretary Scott Bessent to Fox Business, just as Bitcoin had crossed the $124,000 mark. He notably stated:“We have also begun to enter the 21st century, with a bitcoin reserve. We are not going to buy any, but we will use seized assets and continue to accumulate them.”These remarks were widely interpreted as an official renouncement of any active Bitcoin purchases by the United States. The market reacted swiftly:
“The Treasury remains committed to exploring budget-neutral solutions to acquire more bitcoin to expand the reserve, and fulfill the President’s promise to make the United States the world bitcoin superpower.”He added that Bitcoin forfeited to the federal government forms the foundation of the Strategic Bitcoin Reserve established by President Trump’s March Executive Order. Treasury is exploring budget-neutral pathways to acquire more BTC. This clarification partially disavows his earlier statement and confirms that Bitcoin purchases remain under consideration, despite no concrete announcement yet. Bessent also emphasized that the current American Bitcoin reserve consists exclusively of BTC seized during legal proceedings, which does not involve public funds.
Slow execution and growing skepticism
Despite Bessent’s clarification, skepticism is mounting. The crypto community is growing impatient with a strategy that appears stalled since the executive order signed by Donald Trump on March 6, establishing the Strategic Bitcoin Reserve and a Digital Asset Stockpile. The order paved the way for budget-neutral BTC purchases, excluding any impact on public finances. However, after five months, no concrete plan has been revealed. Senator Cynthia Lummis reminded that Congress must approve any direct acquisition, possibly explaining the Treasury’s caution.“@SecScottBessent is right: a budget-neutral path to building SBR is the way. We cannot save our country from $37T debt by purchasing more bitcoin, but we can revalue gold reserves to today’s prices & transfer the increase in value to build SBR. America needs the BITCOIN Act.”
— Senator Cynthia Lummis (@SenLummis) August 14, 2025The latest publication from the Digital Asset Working Group did not clarify purchase modalities. Potential options include revaluing gold certificates or using customs revenues, but these remain theoretical with no timeline. Bessent’s lukewarm response failed to reassure sector players. Eli Nagar, CEO of mining company Braiins, criticized the ongoing “exploration” without execution:
“Are you seriously still exploring budget-neutral solutions? At some point, exploring without executing looks like avoidance. Come on, get moving!”Max Keiser, Bitcoin advisor for El Salvador, mocked the repeated use of the word “exploration” by US authorities. These criticisms reflect a deeper unease. While other countries advance rapidly in Bitcoin strategies, the US seems stagnant, risking losing its strategic edge. Despite no new purchases, Bessent confirmed the government will stop selling its current Bitcoin reserves, estimated between $15 and $20 billion. According to BitBo dashboard data, the US holds 198,012 BTC valued at $23.5 billion at current prices. Holding BTC is a positive signal but does not compensate for the lack of clear future plans. This episode highlights the critical need for clear and consistent communication from US authorities on crypto matters. Until acquisition strategies are clarified, the US risks losing its claimed strategic advantage. Whether Congress will facilitate progress or perpetuate institutional inertia remains to be seen.
Frequently Asked Questions (FAQ)
Government Bitcoin Strategy
Q: What caused the market panic on August 14th? A: The market panic was triggered by ambiguous remarks made by Treasury Secretary Scott Bessent during a media appearance, which investors misinterpreted as the U.S. government renouncing any Bitcoin acquisition. Q: What was the initial statement made by Treasury Secretary Scott Bessent? A: Secretary Bessent stated, "We have also begun to enter the 21st century, with a bitcoin reserve. We are not going to buy any, but we will use seized assets and continue to accumulate them." Q: How did the market react to Bessent's initial statement? A: Bitcoin's price dropped significantly, erasing tens of billions of dollars in market capitalization within minutes, affecting the entire crypto market. Q: Did Bessent clarify his remarks? A: Yes, hours later, Bessent clarified on social platform X that the Treasury remains committed to exploring budget-neutral solutions to acquire more Bitcoin and fulfill the President's promise to make the U.S. a "world bitcoin superpower." Q: What is the current U.S. government policy regarding Bitcoin reserves? A: The current U.S. Bitcoin reserve consists exclusively of BTC seized during legal proceedings, which does not involve public funds. The government has confirmed it will not sell its existing reserves. Q: What is the Strategic Bitcoin Reserve? A: The Strategic Bitcoin Reserve was established by President Trump's March Executive Order, paving the way for budget-neutral BTC purchases. Q: Why is there skepticism about the U.S. Bitcoin strategy? A: Skepticism arises from the slow execution and lack of a concrete plan five months after the executive order, despite the stated intention to explore budget-neutral purchases. Q: What are some potential budget-neutral pathways for the U.S. to acquire Bitcoin? A: Potential options mentioned include revaluing gold certificates or using customs revenues, though these remain theoretical without a defined timeline. Q: What has been the reaction from the crypto community to the U.S. strategy? A: The crypto community has expressed impatience and criticism regarding the slow pace of execution and the confusing communication from U.S. authorities. Q: How does the U.S. strategy compare to other countries? A: Critics note that other countries are advancing rapidly with their Bitcoin strategies, suggesting the U.S. risks losing its strategic edge.Crypto Market AI's Take
The Treasury Secretary's initial statement and subsequent backtracking highlight the volatile nature of government pronouncements on cryptocurrencies. This episode underscores the critical need for clear and consistent communication from regulatory bodies to prevent market instability and foster investor confidence. At Crypto Market AI, we leverage advanced AI agents to analyze market sentiment and provide real-time insights into such developments. Our platform is designed to navigate the complexities of the crypto market, offering tools for informed decision-making. You can learn more about how AI can help you understand market dynamics and make strategic investment choices on our AI Crypto Market Platform.More to Read:
Originally published at Cointribune on Fri, 15 Aug 2025.