Despite strong industry momentum, three state-level Bitcoin Reserve bills have already failed. These failures have only happened because several Republican members voted against the bills.

Although the crypto industry made huge gains with Trump’s Presidency, its political influence may be shallower than expected. The remaining proposed bills will be an important test of strength.

Will Bitcoin Reserves Fail Across America?

Over the last few months, several US states have tried to set up their own Bitcoin Reserves. Nearly 30 states proposed a bill to add BTC to its reserve in the past few months. The goal with the majority of these bills is to use the leading cryptocurrency as a hedge against ongoing inflation.

The industry is very bullish because a few successful proposals would trigger billions in new acquisitions. If approved, a Bitcoin reserve would potentially hike the demand for BTC in a market where supply is already shrinking fast.

However, the movement hit a setback today. Montana lawmakers rejected this proposal 41-59, and they’re not its only opponents.

Currently, Montana’s House of Representatives has 58 Republicans and 42 Democrats, meaning that a substantial number of Republicans voted against the bill. North Dakota, a much redder state, saw an even higher number of defections.

Wyoming Senator Cynthia Lummis is a leading national pro-crypto advocate, but her own colleagues rejected a Bitcoin Reserve handily.

In other words, President Trump’s own party could become a major obstacle to state-level Bitcoin Reserves. During his campaign, Trump strongly advocated for a national Bitcoin reserve plan. Last month, he signed an executive order from the cryptocurrency work group to assess the potential for a national digital assets stockpile.

Yet it seems like several Republican members are not completely on board with his vision. If the Republicans continue showing this level of opposition at the state level, it may completely doom the project.

Other state-level Bitcoin Reserves may be facing similar pressure. Although Utah recently advanced its own proposal, other likely states are experiencing troubles.

Most recently, Texas’ new Lt. Governor called a Reserve a “top priority” for 2025, but vocal criticism has been growing. Some Republicans argue the plan is too risky for taxpayer funds, and media outlets are furious:

“Texas Republicans are on a fast track to approving SB 21. The bill will allow [them] to hire a crypto firm to manage the strategic reserve in yet another giveaway to an industry that does little more than waste electricity. SB 21 needs to die,” a column in the Houston Chronicle, the third-largest local paper in Texas, claimed.

Ultimately, these developments may be a major setback, but they don’t prove that a Bitcoin Reserve is doomed. The industry strongly supports this regulation and is prepared to throw significant political capital behind it.

This upcoming battle will be a real test case for the industry’s actual control of the GOP and the US legislature as a whole.

Ethereum (ETH) has fallen more than 8% in the last 24 hours and over 22% in the past 30 days, reflecting a bearish market sentiment. The price was already in decline before the Bybit hack, which further impacted market sentiment.

Although Bybit has since recovered 84% of its reserves, ETH’s price remains under pressure. With key resistance at $2,850 and no break above $2,900 since February 2, Ethereum’s outlook remains uncertain as bearish indicators continue to dominate.

Bybit Is Recovering Its ETH Reserves After the Hack

Ethereum’s supply on Bybit experienced a dramatic decline after the hack, plummeting from 443,000 ETH to just 20,250 ETH in a single day.

This sudden drop triggered panic selling pressure on ETH and also on BTC and other coins, as market participants feared a potential liquidity crisis.

The sharp decrease in reserves heightened uncertainty, leading to widespread speculation about the aftermath. Some users suggested that Bybit might be forced to buy back ETH to restore its reserves, potentially creating strong buying pressure.

Since February 22, Bybit’s ETH reserves have shown significant recovery, surging from 29,000 ETH to 372,000 ETH by February 24, which accounts for 84% of its pre-hack reserves.

The market’s initial panic selling appears to have been temporary, and the rebound in reserves could lead to renewed buying interest in ETH. However, Ethereum’s price has not recovered to levels before the hack yet.

Indicators Show No Signs of a Bullish Momentum

The Relative Strength Index (RSI) for Ethereum was recovering after the Bybit hack, reaching 63.2 yesterday, indicating strong buying momentum.

However, it has since dropped sharply and is now at 43, signaling a significant shift in market sentiment. RSI is a momentum oscillator that measures the speed and change of price movements, ranging from 0 to 100.

Typically, an RSI above 70 suggests that an asset is overbought, indicating potential selling pressure, while an RSI below 30 indicates that an asset is oversold, potentially signaling buying opportunities.

An RSI between 30 and 70 is generally considered neutral, with movements within this range reflecting normal market fluctuations.

Ethereum’s RSI dropping from 63.2 to 43 in just one day suggests a rapid shift from bullish to bearish sentiment. This significant decline could indicate increased selling pressure or reduced buying interest, possibly due to lingering concerns about the aftermath of the Bybit hack.

A drop to 43 also brings RSI closer to the oversold territory, which, if continued, could indicate a further bearish trend. However, if buying interest resumes, the RSI could stabilize or even rebound, suggesting a potential recovery.

Ethereum’s DMI chart shows the ADX at 18.3, down from 21.4 yesterday, indicating weakening trend strength. An ADX below 20 suggests a lack of clear momentum, aligning with Ethereum’s ongoing downtrend.

Meanwhile, the +DI dropped from 30.4 to 20, showing decreased buying interest, while the -DI rose from 12.3 to 22.9, signaling increased selling pressure.

The crossover of -DI above +DI confirms bearish dominance, suggesting continued downward pressure on Ethereum’s price.

The weakening ADX, combined with rising -DI, points to a declining trend that may persist unless buying momentum returns. This could result in further price drops or sideways movement in the short term

Ethereum Price Has Been Below $2,900 For Three Weeks

Ethereum has struggled to break above the $2,850 resistance, which has been repeatedly tested in recent weeks. If the current downtrend continues, ETH could test the support at $2,551, and if that level fails, it might drop further to $2,159.

Notably, Ethereum hasn’t broken above $2,900 since February 2, highlighting strong resistance in this range.

However, if Bybit successfully restores its reserves to pre-hack levels, this could boost positive sentiment for ETH. In this scenario, an uptrend might retest the $2,850 resistance, and if broken, Ethereum price could rise to $3,020.

Should momentum continue, the next target would be $3,442. A break above $2,900 would be significant, as ETH has struggled with this level since early February, potentially signaling a bullish reversal.

OKX announced today that it reached a settlement with the US Department of Justice (DoJ), closing previous investigations. It pled guilty to several charges and will pay over $504 million.

The exchange depicted this settlement as a casual misunderstanding, but the DoJ’s own press release referred to its “flagrant violations” and “blatant disregard.”

OKX Settles with the DoJ

OKX, one of the world’s leading crypto exchanges, has been clearing house on its global regulatory compliance issues. On one hand, it secured a MiCA license for EU operations last week. Now, the exchange is progressing towards new compliance in the US, announcing a settlement with the DoJ:

“We cooperated with the US Department of Justice in their thorough investigation of our business. We had a small percentage of customers who were able to use our international services due to historical compliance gaps. Today our compliance controls are among the leading in the industry. This matter is now behind us,” the firm claimed on social media.

According to the announcement, the exchange acknowledged that it allowed some US customers to trade on its platforms without proper licensing. OKX agreed to pay a fine of $84 million and forfeit $421 million in user fees. This concludes a saga of year-long investigations into the firm.

The US government’s financial regulatory apparatus is changing its attitude towards crypto, but frictions remain. The DoJ itself emphasized that the firm pled guilty to serious offenses. Quoting various officials, the DoJ referred to OKX’s “flagrant violations” and “blatant disregard” in its conduct.

It seems that the DOJ’s attitude towards the crypto industry will remain distinct from other federal regulators. In the last week alone, the SEC dropped a major lawsuit against Coinbase and quietly dismissed a probe into Robinhood’s potential misconduct. It also ended an investigation against NFT marketplace OpenSea.

OKX’s settlement involves an actual fine and guilty plea, which is more than these institutions can claim.

Nonetheless, OKX should be quite pleased with this settlement. It earned over $1.5 billion in revenue last year, and it has substantial asset holdings and trade volumes.

Although $504 million is a hefty price to pay, it is a worthwhile fee to regain the US regulator’s good graces.