Bitcoin (BTC) Price: Trump Administration May Have Bought the Dip at $60,000, Says Cramer

TLDR

• Bitcoin (BTC) rebounded 12% from Friday’s low of $62,822 to around $70,998, recovering after last week’s sharp sell-off
• The Coinbase Premium index surged over 70%, rising from -0.23% to -0.06%, indicating renewed buying interest from U.S. investors
• Analysts believe the rally is primarily driven by short-covering and a short squeeze rather than fresh bullish demand
• CNBC’s Jim Cramer sparked speculation that the Trump administration purchased bitcoin at $60,000 for the strategic reserve, though no official confirmation exists
• Long-time bitcoin critics, including the Financial Times and Peter Schiff, declared victory as Strategy’s bitcoin holdings fell below their average cost basis of $76,000

Bitcoin has recovered from last week’s sharp decline. The cryptocurrency is now trading around $70,400 after hitting a low of $62,822 on Friday.

The rebound represents a 12% gain in just a few days. According to CoinGecko data, bitcoin reached $70,998 during early Asian trading on Monday.

The recovery comes as U.S. investor appetite appears to be improving. The Coinbase Premium index, which tracks the price difference between Coinbase and Binance, jumped over 70% since Friday.

The index moved from -0.23% on Friday to -0.06% on Monday. This shift suggests American investors are returning to the market.

Technical Bounce or Sustainable Recovery?

Analysts warn the rally may not last. Ryan Yoon, senior analyst at Tiger Research, told Decrypt that the Fear & Greed Index hitting an extreme low of 5 indicates a technical reaction.

Aggregated open interest has declined while cumulative volume delta turned positive. This pattern typically shows traders closing short positions rather than opening new long ones.

A short squeeze happens when bearish traders are forced to buy back bitcoin to limit losses. This buying pressure can push prices higher temporarily.

The bounce follows a brutal week for bitcoin. The cryptocurrency fell below $76,000, dropping below Strategy’s average purchase price.

Strategy, formerly known as MicroStrategy, has invested over $54 billion in bitcoin over five years. The company was reportedly down about 3% on its investment as of this week.

Speculation About Strategic Reserve

CNBC host Jim Cramer sparked market speculation during a live broadcast. He suggested the Trump administration might have purchased bitcoin at $60,000 for the U.S. strategic reserve.

However, no official confirmation has been provided. The White House has previously stated the strategic reserve will only be expanded in a “cost-neutral” manner.

Long-time bitcoin skeptics used the recent decline to criticize the asset. The Financial Times published multiple articles questioning bitcoin’s value proposition.

Peter Schiff, a gold advocate, pointed out that bitcoin has fallen to 15 ounces of gold. This represents a 59% decline from its November 2021 high when priced in gold.

Despite the criticism, some analysts remain optimistic about longer-term prospects. Nick Ruck, director of LVRG Research, expects a potential rebound this year as institutional adoption continues.

The broader market context includes a rally in Asian equities. Japan’s Nikkei 225 jumped 5% after Prime Minister Sanae Takaichi’s election victory.

Bitcoin is currently trading at $70,400 according to the latest market data.

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