The White House will release a crypto policy report on July 30. This report, which was originally expected on July 22, is now confirmed. It comes from the President’s Working Group on Digital Assets after a 180-day review following an executive order from January.

Strategic Bitcoin Reserve

A key part of the report is the Strategic Bitcoin Reserve, a proposed stockpile of Bitcoin held by the U.S. government. The report is expected to disclose how much Bitcoin the government owns, primarily gained through legal seizures. It will likely outline the reserve’s role in the country’s digital asset strategy. The report may also suggest a federal regulatory framework for the issuance, management, and use of digital assets in financial markets. The crypto industry is watching closely, as these recommendations could significantly shape future policies and market structures. The report’s release on July 30 is a big event, likely leading to increased market volatility. Implied volatility for Bitcoin options set to expire in early August is expected to rise as traders react to the news. This scenario is favorable for strategies that benefit from large price movements, such as buying straddles or strangles. The Strategic Reserve proposal is crucial, especially since government wallets already contain over 214,000 BTC from seizures. If the policy establishes this as a long-term holding instead of something to sell, it would reduce future selling pressure—an encouraging sign for the market. We could see a spike in call option buying and more long futures positions if there are leaks suggesting this outcome.

Government And Regulatory Actions

We’ve seen similar reactions to significant government and regulatory actions before. When the spot Bitcoin ETFs were approved in January, the market experienced a brief sell-off followed by a sustained rally, since the news was largely anticipated. A “sell-the-news” reaction could happen again, so traders should be cautious of initial market shocks. In addition to the stockpile, the proposed federal regulatory framework carries its own risks. Vague or overly strict regulations could unsettle the market, possibly causing a sharp downturn. To prepare for this, it may be wise to hedge long positions by buying protective put options. As the date approaches, we will monitor derivatives data such as funding rates on perpetual swaps and open interest on CME. A significant rise in open interest would suggest that institutional investors anticipate a major price movement. The clarity sought since the last administration’s executive order is nearing, and we expect to see confidence first in the derivatives markets. Create your live VT Markets account and start trading now.

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