Countries are not widely liquidating Bitcoin reserves to stabilize their currencies; rather, some nations are exploring or expanding their Bitcoin holdings as part of strategic reserves or diversification efforts. There is no clear evidence that governments are selling Bitcoin en masse to support their national currencies amid economic instability.
Several countries have taken steps toward accumulating Bitcoin as a sovereign asset rather than liquidating it. For example, France is considering a landmark proposal to create a national Bitcoin Strategic Reserve, aiming to acquire around 420,000 BTC over seven to eight years. This would position Bitcoin alongside traditional reserves like gold and foreign currency, reflecting a long-term strategy rather than a short-term liquidation to stabilize the euro or the franc. The plan also includes sustainable Bitcoin mining powered by nuclear and hydroelectric energy, aligning with France’s energy goals[1][6].
Similarly, Kazakhstan’s central bank has discussed the possibility of investing portions of its gold and foreign exchange reserves into cryptocurrencies, including Bitcoin. This initiative is part of establishing a national cryptocurrency reserve, which would hold crypto assets seized in criminal cases and potentially other government funds. This approach suggests an interest in diversifying reserves with crypto assets rather than liquidating them to stabilize the currency[3].
On the other hand, the cryptocurrency market itself has experienced significant volatility and liquidations unrelated to direct government actions. In October 2025, a major crypto market crash triggered by geopolitical tensions—specifically, an announcement of 100% tariffs on Chinese goods by former U.S. President Donald Trump—led to a massive liquidation event. Over $19 billion in leveraged crypto positions were liquidated in a single day, affecting more than 1.6 million traders. Bitcoin’s price dropped sharply from around $122,000 to below $105,000 during this period. This crash was driven by market leverage and risk-off sentiment rather than government sales of Bitcoin reserves[2][5][7].
This market turmoil has increased regulatory scrutiny and may influence how institutional and sovereign actors approach crypto holdings in the future. However, it does not indicate that countries are liquidating Bitcoin reserves to stabilize their currencies. Instead, the trend among some governments is toward integrating Bitcoin into their financial strategies as a hedge against inflation and currency risk, not as a tool for immediate currency stabilization through liquidation[1][3].
In summary, while the crypto market has seen dramatic liquidations due to external shocks and speculative trading, sovereign states appear to be moving toward Bitcoin accumulation or cautious integration rather than liquidation. The idea of countries selling Bitcoin reserves to stabilize their currencies is not supported by current evidence; rather, Bitcoin is increasingly viewed as a strategic asset in national reserves.