Key takeout
- Speculations suggest that the US DOJ is liquidating the seized Bitcoin and affecting its price.
- The clarity of price transfers for Bitcoin linked to DOJ Actions is expected within 30 days.
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David Bailey, a well-known Bitcoin advocate and CEO of BTC Inc, speculates that Bitcoin's recent price drop may be linked to U.S. Department of Justice (DOJ) sales activities.
“When the DOJ has settled US Bitcoin (opposed to the president) since it got court approval three months ago, Bitcoin price action makes perfect sense.”
In a follow-up statement, Bailey noted that clarity of the situation should come within “30 days.”
His comments came after President Trump issued an executive order to establish a strategic Bitcoin Reserve using seized coins.
Under Trump's new order, the Treasury and Commerce Departments are responsible for building budget-neutral strategies for further BTC acquisitions, provided that these strategies do not impose incremental costs on American taxpayers.
Like other altcoins seized by US authorities, the exact amount of Bitcoin remains unknown. According to data tracked by Arkham Intelligence, the US government sign wallet currently holds 198,109 BTC, worth nearly $16 billion.
In an interview with Bloomberg Television last Friday, White House AI and Crypto Czar David Sacks said the government will conduct a full audit of crypto holdings after the establishment of the Strategic Bitcoin Reserve.
The audit is part of Trump's executive order and is intended to ensure that all digital assets, including Bitcoin, are properly explained and protected. According to Sacks, the DOJ could own up to 200,000 BTC, but it requires an official audit for verification.
Analysts make sure Bitcoin Tests are testing low support before potential recovery
It is still unknown if DOJ has offloaded some of the government's Bitcoin holdings. What is clear, however, is that there is low enthusiasm for the US strategic Bitcoin reserve narrative, as new purchases are not expected in the near future.
Additionally, after Trump revealed the possibility of a slump in a recent Fox News interview, concerns about a potential recession deepened, adding even more downward pressure on risky assets.
Bitcoin reached its $79,300 minimum on Monday morning, according to Coingecko data.
Crypto's total market capitalization has plummeted from around 5% to $2.7 trillion in the last 24 hours, but Crypto Fear and the greedy index have fallen 7 points and landed firmly in the “extreme fear” zone.
Bitget Research's chief analyst Ryan Lee is hoping that Bitcoin will test support levels between $70,000 and $75,000 this week, with resistance ranging from around $85,000 to $87,000.
“BTC could potentially test the low range of $70,000 to $72,000 because it failed to maintain its $77,000 level. However, if the market is seeing a recovery, a potential bounce from $75,000 could push prices back into the $80,000-$85,000 range,” Lee said in a memo on Monday.
“This week's most likely scenario suggests a mid-term test of $72,000-75,000, with Bitcoin still steady at nearly $83,000 by March 18-19.
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