Peter Schiff Criticizes Trump’s Strategic Bitcoin Reserve Plan

Trump’s Strategic Bitcoin Reserve Sparks Debate on Bitcoin’s Future

Can government-backed Bitcoin reserves truly fit with crypto’s decentralized vision? That’s the big question shaking the digital market this week. 

BTC slipped below $102,000, and investors are debating whether Donald Trump’s proposed Strategic Bitcoin Reserve would protect or hurt cryptocurrency’s independence.

Peter Schiff, an economist, weighed in again and said, "If government intervention is required to save BTC, then the fallacy behind the creation of a BTC reserve is exposed." His words questioned whether the Strategic Bitcoin Reserve went against crypto's very core: a currency free of government control.

Source: X (formerly Twitter) 

Community Pushback: Bitcoin Doesn't Need a Bailout

The crypto community was quick to respond. Many argued that This digital asset doesn’t need government help because it isn’t owned or controlled by any state. It has no liabilities, no counterparty risk, and no central authority; it works independently. Supporters say if a country decides to hold BTC, that’s a strategic decision, not a bailout.

Others added that it’s code ensures true decentralization, meaning no government can ever control it. One user explained, “If countries didn’t own gold, gold would still have value. Digital asset's value comes from belief, not ownership.”

Senator Cynthia Lummis has now backed the Strategic Bitcoin Reserve, saying it could help reduce national debt and strengthen America’s financial resilience through responsible adoption of this largest cryptocurrency.

Crypto Market Faces Heavy Losses

The broader crypto market dropped 4.63% over 24 hours, and more than 10% this week. Several factors contributed to the fall in price:

• Security breaches drained more than $120 million from Ethereum and Balancer protocols. 

• The leverage unwinding sparked almost $315 million in BTC long positions liquidation.

Technical Breakdown and Liquidation Wave

BTC’s drop below $103,000 triggered massive automated sell orders. The RSI fell to around 33, showing weak buying momentum, while the MACD still signaled a bearish trend.

Source: CMC

More than $2.09 billion in crypto positions were liquidated in a single day with $1.68 billion from long positions, marking the biggest flush since October. Analysts say high leverage made the correction worse, especially as Ethereum’s 10% decline dragged it down further.

Macro Headwinds and Market Fear

Beyond technicals, global politics and the economy added more pressure. The 36-day US government shutdown and renewed Trump–China tariff tensions spooked investors. The S&P 500 dropped by 1.2%, proving how linked crypto and traditional markets have become.

Analysts noted that it’s volatility had hit a six-month low before the crash, a typical “calm before the storm” setup. Traders now wait for political clarity and fresh liquidity before entering the market again.

Bitcoin Price Prediction

If the selling pressure continues, it could retest $100,000 soon. But if buyers manage to defend that level, the market might see a rebound toward $104,000–$106,000 in the coming week. 

Final Thoughts

Trump’s Strategic Bitcoin Reserve idea has clearly divided the crypto world. Supporters see it as proof that it is now a national-level asset, while critics like Peter Schiff call it a contradiction to decentralization. As the market struggles and politics heat up, coin’s next move could decide whether a government-backed reserve will strengthen or weaken the heart of its decentralized belief.

Disclaimer: This Article is for information purposes only and not a financial advice, please do your own research before investing in crypto market.