Hi Reader,

Thanks for reading The BlockByte Weekly, where we summarise the key updates in crypto over the last week and provide our perspective on what you need to know as an investor.

If you have any questions or want to discuss the market in more detail, please don't hesitate to reach out.

Thanks,
James

Key Events This Week

• The US Government has passed two significant executive orders: the Bitcoin Strategic Reserve Act and the Digital Asset Stockpile
• Crypto and share markets are still down and could be heading lower as cost cuts and tariffs bite US & global economies
• Texas heads one step closer to be the first US state to establish a state level Strategic Bitcoin Reserve whilst Bhutan's Prime Minister advocates for holding bitcoin
• US regulator, SEC, drops litigations against crypto companies, sparking criticism around donations made during presidential campaign trail

Breakdown

The Bitcoin Strategic Reserve Act and the Digital Asset Stockpile

• The Strategic Bitcoin Reserve will hold (not sell) approximately 200,000 BTC and may acquire more in a "budget neutral" way
• Non-Bitcoin digital assets (XRP, SOL, ETH, ADA, etc.) will be held in a separate stockpile, which may be sold without plans to buy more

Crypto and Share Markets Could be Heading Lower

• Despite the positive strategic reserve and digital asset stockpile news, bitcoin prices fell from ~$90,000 to $86,000
• The broader market is experiencing turbulence due to Trump's economic policies, including trade tariffs and government spending cuts
• According to reports, over 100,000 government workers have been fired by the Trump administration sparking concerns of a US recession which could drag markets lower
• The Department of Government Efficiency (DOGE) claims $55 billion in savings since Trump took office, though Reuters analysis shows actual contract cuts total only $8.5 billion

Texas One Step Closer to Strategic Bitcoin Reserve, Bhutan Advocates Holding Bitcoin

• Texas has voted 25-5 in favour of a Strategic Bitcoin Reserve (SB-21), which now moves to their House of Representatives
• Utah is reportedly closest to approving its own Bitcoin bill according to BitcoinLaws.io
• Bhutan's Prime Minister Tshering Tobgay has revealed the country's Bitcoin holdings are now worth over $1 billion, acquired through renewable mining infrastructure
• Bhutan reportedly uses Bitcoin to finance government workers, healthcare and education programmes and advocates that more countries should be doing the same

SEC Drops Litigations Against Crypto Companies

• The SEC has dropped lawsuits against both Kraken and Coinbase as well as various other crypto companies since Trump took office
• Crypto companies spent over $134 million during the 2024 election, with Kraken and Coinbase each making $1 million donations to Trump's Inaugural Fund
• In the more 'traditional' world of finance, a report from the Center for Political Accountability (CPA) warns of "profound risks" as cryptocurrency companies increase political spending amid regulatory retreat

Our Perspective

Looking at all of the events happening across the world, there continues to be a higher degree of uncertainty around how the crypto markets will perform over the next twelve months when compared to the last two years of growth. In some ways, the US Strategic Reserve & Digital Asset Stockpile announcement yesterday was the biggest 'good-news' event imaginable. Yet, even with the US government effectively embracing the entire industry, prices have been flat to down this week due to the broader uncertainty in the global economy.

From my perspective, the only way to enter this market is, and always has been, with a multi-year time frame. There's an expression that time in the market always beats timing the market, and that's generally been true for the years I've been investing. Sitting on the sidelines and waiting for the market to be more positive can often mean missing out on the biggest returns. For example, what happens to the price of bitcoin if China or another major economy was to announce a similar reserve? What happens when the US does start acquiring more bitcoin? It would not be unexpected if other large nation states are now planning to acquire bitcoin in response to the US's announcement.

This week, perhaps the biggest hurdles for the crypto industry were successfully jumped. Because of that, I'm still very optimistic with a medium to long-term outlook.

Until next week,
James

James Brannan
Managing Director
BlockByte
​
(+61) 412 393 634
​james@blockbyte.com.au​
​https://blockbyte.com.au/​

BlockByte does not provide financial advice. We provide a personalised brokerage service with tailored support, research and secure custody for investing in digital assets. Reach out to our team to discuss how we can help.

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