Bitcoin’s price continues to slide, despite discussions surrounding a potential Texas Bitcoin reserve. After peaking at $106,490 in December, the cryptocurrency has dropped by 16% in the past month and now stands at $87,234. This decline reflects growing investor caution and broader economic instability.

Why Is Bitcoin Dropping?

Two major factors are driving Bitcoin’s current downturn:

1. Profit-Taking After Record Highs
   Bitcoin’s surge past $100,000 led many investors to cash out, fearing an overheated market. This sell-off has contributed to the continued decline.
2. Stock Market Uncertainty
   Key U.S. stocks, including Tesla, Walmart, Nvidia, and Palantir, have also dipped, signaling broader economic concerns. Geopolitical tensions, tariff threats, and federal spending cuts are creating a cautious investment environment.

The Texas Bitcoin Reserve Proposal

Despite the market downturn, Texas lawmakers are considering a strategic Bitcoin reserve. Two proposed bills—one by Rep. Giovanni Capriglione and another by Sen. Charles Schwertner—aim to establish a state-run Bitcoin stockpile.

Unlike direct government purchases, the reserve would be funded through donations rather than taxpayer money. If implemented, the reserve could be used for emergency situations, philanthropic efforts, and other state-approved purposes.

Trump’s Influence on Crypto Policy

Former President Donald Trump has emerged as a pro-crypto figure in his second administration. He has ordered a crypto task force to explore regulations and potential government-backed crypto reserves. His administration’s stance could shape future policies surrounding state and federal crypto holdings.

What’s Next for Bitcoin?

While Texas lawmakers push forward with crypto-friendly initiatives, Bitcoin’s price remains volatile. Investors are watching for signs of market stabilization, but with economic uncertainties persisting, Bitcoin may continue to face short-term headwinds.