The Treasury Secretary Scott Bessent caused a stir on August 14 when he initially stated that the government would not be expanding its Bitcoin holdings, only to later backtrack on his comments. In the morning, Bessent told reporters that the Strategic Bitcoin Reserve would remain at its current level, which consists of $15 billion to $20 billion in Bitcoin seized in criminal cases. He also mentioned that there were no immediate plans to purchase more Bitcoin for the reserve.
However, in a surprising turn of events, Bessent took to social media later in the day to clarify that the Treasury was still open to exploring budget-neutral pathways to add to the reserve. This reaffirmed the government’s commitment to accumulating more Bitcoin, although the specifics of how this would be achieved were not disclosed. A budget-neutral strategy typically involves finding ways to fund purchases without increasing the federal deficit, such as liquidating other assets or creating revenue streams to offset costs.
The Strategic Bitcoin Reserve was established in March through an executive order signed by President Donald Trump as part of an effort to integrate digital assets into U.S. financial strategy. Supporters believe that diversifying national reserves with Bitcoin can provide a hedge against inflation and strengthen the country’s position in global currency competition. The program currently relies on Bitcoin confiscated by law enforcement as its base supply.
The change in tone from the Treasury Secretary came amidst a volatile trading session for Bitcoin. The cryptocurrency reached a new record high above $124,000 before experiencing a dip to around $117,000 later in the day. This drop was attributed to stronger-than-expected wholesale inflation data, which tempered market expectations of a potential interest rate cut by the Federal Reserve in September.
Bessent’s comments also coincided with leadership changes in the administration’s digital asset policy team, including the departure of Bo Hines, who played a key role in designing the reserve framework. Hines’ exit has led to speculation about potential adjustments to the program’s scope and timing.
At the time of writing, Bitcoin is ranked #1 by market cap with a price decrease of 4.14% over the past 24 hours. The cryptocurrency has a market capitalization of $2.36 trillion and a 24-hour trading volume of $104.23 billion. The total crypto market is valued at $4.01 trillion with a 24-hour volume of $287.6 billion, and Bitcoin dominance is at 58.81%.