Bitcoin entered a stormy stretch last week, marked by price volatility, intensified state involvement, and growing geopolitical symbolism around the world’s largest cryptocurrency. Once again, bitcoin proved itself as much a political lightning rod as a digital asset.
The price of bitcoin dropped sharply over the course of the week, slipping nearly 6 percent to below $98,000. Analysts pointed to renewed macroeconomic uncertainty and shifting investor sentiment following new U.S. trade tariffs and global risk repricing. These moves reignited debate about bitcoin’s role as either a hedge against traditional finance or a highly correlated speculative instrument.
In the United States, the cryptocurrency took a startling turn into state strategy. President Donald Trump signed an executive order establishing a Strategic Bitcoin Reserve, using forfeited bitcoin seized in federal operations to create what is now believed to be the largest state-held stash of bitcoin in the world. The move was lauded by crypto advocates as a signal of long-term adoption, but it also raised concerns about concentration of digital assets under political influence.
In a parallel development, Trump Media & Technology Group announced plans to raise $3 billion, partly to invest in cryptocurrencies. The move reflects a broader corporate shift among politically aligned firms seeking to capitalise on the momentum behind bitcoin and related digital assets.
Across the Atlantic, the crypto spotlight turned to the United Kingdom, where Reform UK leader Nigel Farage vowed to spearhead a ‘crypto revolution’. His vision includes a sovereign bitcoin reserve housed within the Bank of England, alongside a flat 10 percent capital gains tax regime for crypto investors. While the proposals are seen as largely aspirational for now, they signal a rising political appetite to integrate cryptocurrency into the national policy agenda.
In Pakistan, the government sparked confusion and criticism after reports emerged of attempts to establish its own bitcoin reserve. The initiative was reportedly motivated by a desire to align with Washington’s pro-bitcoin policies. However, officials quickly reaffirmed that cryptocurrency remains banned under domestic law, exposing the inconsistencies in Pakistan’s approach to digital assets and raising questions about its regulatory coherence.
Meanwhile in El Salvador, the world’s first country to adopt bitcoin as legal tender faced international pressure to roll back aspects of its law. In exchange for a $1.4 billion loan agreement with the International Monetary Fund, the government reportedly agreed to weaken provisions that forced businesses to accept bitcoin. This marked a quiet retreat from the country’s headline-grabbing experiment, although the broader project remains in place.
Altogether, the week’s developments underscored how bitcoin continues to transcend its origins as a decentralised peer-to-peer currency. Whether used by states as a hedge, a weapon, or a symbol of sovereignty, bitcoin’s role in global affairs is becoming increasingly institutional and contested. As its political and financial relevance grows, so too does the risk that volatility will no longer be confined to price charts alone.
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