Key highlights:
- The Trump administration created a strategic Bitcoin reserve and passed the first major federal stablecoin law.
- Escalating trade tariffs triggered sharp crypto market volatility and record liquidations in October 2025.
- Bitcoin declined about 10% during the period despite regulatory progress and institutional support.
On January 3, President Donald Trump praised his role in advancing the cryptocurrency industry, declaring himself one of its strongest supporters. He argued that U.S. leadership in digital assets is essential to compete with China and ensure technological dominance.
President Trump on Crypto
“I’m a big crypto person, I’m the one that helped crypto more than anybody because I believe in it.. And the reason I believe in it is because if we don’t do it, then China’s gonna do it.”
🔻 Scott Bessent Chines in..
President Trump made America the… pic.twitter.com/tfcOdQATiY
— Whiplash347 (@Whiplash437) February 3, 2026
His administration has taken visible steps. In March 2025, a strategic Bitcoin reserve was established using roughly 200,000 BTC seized in criminal cases. A separate U.S. digital asset vault was also created for other confiscated cryptocurrencies, reportedly without direct cost to taxpayers.
In December 2025, Trump signed the GENIUS Stablecoin Regulation Act, the first major federal cryptocurrency law in U.S. history. The law introduced full collateral requirements for stablecoins and established a federal oversight framework.
The administration also appointed crypto-friendly Paul Atkins to lead the Securities and Exchange Commission and hosted the first crypto summit at the White House.
Yet the broader economic context tells a more complicated story.
Trade wars and market turbulence
While regulatory initiatives signaled institutional support, aggressive tariff policies injected significant uncertainty into global markets.
In April 2025, the administration introduced baseline tariffs of 10% on all imports, with higher duties targeting specific regions. Tariffs on Chinese goods escalated sharply, eventually reaching as high as 125% after retaliatory measures from Beijing. Additional duties affected imports from the European Union and other Asian economies.
Cryptocurrency markets reacted swiftly. Bitcoin miners faced elevated costs due to tariffs on imported mining equipment, while investors responded nervously to each new escalation. Major announcements frequently triggered rapid sell-offs across digital asset markets.
October 10 shock and record liquidations
The most dramatic episode occurred on October 10, 2025, when additional 100% tariffs on Chinese goods were announced following export restrictions on rare earth materials. Bitcoin fell sharply from $126,272 to $102,173 in a single wave of selling, a nearly 19% decline from its peak.
Total cryptocurrency market capitalization dropped by approximately $900 billion from the day’s high to its low. Roughly $500 billion evaporated within minutes as leveraged positions were liquidated. Daily liquidations reached a record $19.31 billion, far exceeding losses seen during previous crises such as the COVID-19 crash or the FTX collapse.
The event exposed how tightly crypto markets had become linked to macroeconomic and geopolitical developments.
Political battles and long-term impact
Despite regulatory progress, political resistance remained strong. In July 2025, the administration struggled to secure unified support within its own party for key crypto legislation. Democrats criticized what they labeled “Crypto Week,” raising conflict-of-interest concerns and proposing restrictions on digital asset ownership for top officials.
From January 20, 2025, to February 3, 2026, Bitcoin declined from $92,000 to $82,000, a drop of roughly 10%. Altcoins experienced steeper losses, and Bitcoin’s market dominance rose to 55%. Ethereum fell from $3,500 to $2,800 during the same period.
The paradox is clear. While the administration promoted institutional adoption and regulatory clarity, tariff-driven economic instability increased volatility and weighed on investor sentiment.
Bitcoin, originally conceived as a decentralized alternative to government systems, now reacts sharply to presidential announcements and trade policy decisions. The creation of a strategic reserve embeds cryptocurrency deeper into national economic strategy, even as global tensions amplify its short-term fragility.
Whether Trump ultimately strengthened the foundations of crypto or amplified its exposure to political risk remains a subject of debate. What is certain is that digital assets are no longer operating outside the sphere of state influence.
Source:: Trump Says He Helped Crypto But the Numbers Tell a Different Story