On May 27, 2025, US President’s crypto czar, David Sacks, says there is a pathway to acquire more bitcoin for the U.S. strategic reserve. This move follows Donald Trump’s executive order signed in March 2025, establishing the reserve as a new pillar for US digital asset policy.
US Crypto-Focused Executive Action
During a fireside chat with Gemini co-founders, Cameron and Tyler Winklevoss, Sacks stated that federal purchase of bitcoin is not guaranteed. “I can’t promise anything,” Sacks said, “but there is a pathway to doing that… if they can figure out how to fund it, they actually do have presidential authorization ready.” However, it might make some progress if done in the best manner.
The executive order drawn in March was created with 200,000 Bitcoin ($22 million), which the government forfeited from civil and criminal assets.
Sacks referenced using surplus money from other government programs to fund such acquisitions. In addition, he said, if the US can convince Howard Lutnik and Scott Bressent to buy some, then there will be no additional taxes on cryptocurrency.
Crypto Agenda– With this plan, President Trump believes that the US could acquire its crypto agenda by August. Besides the Strategic plan for Bitcoin, David Sacks outlines other policies for crypto in the US. Sacks also expects the Genius Act Stablecoins bill to pass, and the market structure bill is likely before August. These policies aim to reform the crypto space in the US and prevent future regulatory backsliding.
The Budget-Neutral Plan
Sacks explained that the federal government is allowed to acquire bitcoin but only in budget budget-neutral way. If it can be done in a budget-neutral way, specifically, if either the Commerce Department or the Treasury Department can figure out how to fund it without adding to the debt, then they are allowed to create those programs,” Sacks stated.
It states that the government can only acquire more bitcoin if it increases the national debt or requires new taxes. The cabinet officials are tasked with developing strategies to fund such acquisitions. This includes reallocating unused funds from the existing federal government.
The recent depeg incident involving sUSD from Synthetix has highlighted that this sector remains fraught with risks despite the immense potential of algorithmic stablecoins.
The sUSD incident is not the first to expose the vulnerabilities of algorithmic stablecoins. From technical challenges and regulatory pressures to dwindling community trust, projects in this space must navigate numerous obstacles to survive and thrive.
The Landscape of the Algorithmic Stablecoin Market
Algorithmic stablecoins, which maintain their value without direct asset backing, were once hailed as a breakthrough in decentralized finance (DeFi). However, according to CoinMarketCap data from April 2025, the total stablecoin market capitalization stands at $234 billion, while algorithmic stablecoins account for about $458 million, equivalent to just 0.2%.
This stark disparity reflects the reality that algorithmic stablecoins have yet to gain widespread trust from the community. High-profile failures like the collapse of UST/LUNA in 2022, coupled with regulatory uncertainties such as the EU’s MiCA framework, have fueled skepticism.
More recently, the depeg of Synthetix’s sUSD is a typical example of this model’s inherent risks.
A Deep Dive into Synthetix’s sUSD Depeg
Synthetix is a well-known DeFi protocol celebrated for its synthetic asset system. Within this ecosystem, sUSD is an algorithmic stablecoin designed to peg its value at 1 USD, backed by the SNX token and price data from Chainlink.
However, sUSD has faced significant challenges with a prolonged depeg recently. At the time of BeInCrypto’s report, sUSD was trading at 0.77 USD, which has persisted since late March 2025. The primary cause was a major liquidity provider withdrawing from the sBTC/wBTC pool on Curve, which triggered intense selling pressure on sUSD. This forced users to convert other synthetic assets like sETH or sBTC into sUSD, exacerbating the price decline.
On April 21, 2025, Kain Warwick, the founder of Synthetix, announced on X that the team had implemented an sUSD staking mechanism to address the issue. However, he noted that the mechanism remains manual and lacks a fully functional user interface (UI), which is expected to launch in a few days.
“Update on the sUSD depeg. We have implemented an sUSD staking mechanism but it’s very manual until the UI goes live in a few days. Here was my hot take from discord though,” shared Kain Warwick, founder of Synthetix.
Warwick further stated that if the incentive mechanism (carrot) proves ineffective, Synthetix would adopt stricter measures (stick) to compel stakers in the 420 pool to participate more actively. He emphasized that, with the collective net worth of SNX stakers reaching billions of USD, Synthetix has the financial resources to stabilize sUSD and resume development of derivative products on Layer 1.
No Successfully Algorithmic Stablecoin Project
Before the sUSD depeg incident, the market witnessed the dramatic collapse of UST/LUNA in 2022. UST, Terra’s algorithmic stablecoin, suffered a severe depeg, dragging LUNA’s value down from $120 to near zero. This event caused billions of USD in losses and significantly eroded trust in the algorithmic stablecoin model.
More recently, the ‘Godfather of DeFi’, Andre Cronje, behind Sonic (formerly Fantom), also shifted direction. Sonic initially developed a USD-based algorithmic stablecoin but later pivoted to a stablecoin pegged to the UAE dirham.
“Pretty sure our team cracked algo stable coins today, but previous cycle gave me so much PTSD not sure if we should implement,” Cronje stated.
Beyond technical risks, algorithmic stablecoins face mounting regulatory pressures. The EU’s MiCA regulation, effective since June 2024, imposes strict standards on stablecoin issuers to ensure consumer protection and financial stability. Under MiCA, algorithmic stablecoins are classified as ART (Asset-Referenced Token) or EMT (E-Money Token), requiring projects to meet complex compliance demands.
This intensifies the pressure on developers, especially as other jurisdictions also tighten crypto regulations.
These examples show the vulnerability of algorithmic stablecoins to liquidity shocks and market sentiment, particularly due to their lack of direct asset backing.
The Potential of Algorithmic Stablecoins
Despite the challenges, algorithmic stablecoins still hold developmental potential. A March 2025 post on X by CampbellJAustin suggested that a next-generation decentralized algorithmic stablecoin is feasible if lessons are learned from past failures.
“I actually think a next-gen decentralized algorithmic stablecoin is possible. I also think it will not be done correctly by the crypto community because the primary constraints are economic and risk management, not technological,” CampbellJAustin shared.
However, projects must focus on building more price stability mechanisms, combining algorithms with liquidity safeguards to succeed. Additionally, they should prepare for regulatory requirements, particularly in regions with stringent rules like the EU. Transparency in operations, regular audits, and clear communication with users are crucial to rebuilding community trust.
By addressing these factors, projects in this space can seize the opportunity to regain confidence and drive innovation.
Chainlink (LINK) has been showing mixed technical signals recently, with some indicators turning bearish while others suggest a potential upside ahead. With its price up 11% in the last seven days, Chainlink was on its path to surpass Pi Network in market cap, but this could be delayed for now.
With LINK almost not moving in the last 24 hours, its market cap is currently $10.3 billion, and Pi Network is around $12.7 billion. The upcoming days will be crucial as several technical indicators reach critical inflection points that could determine whether LINK continues its rally or faces a correction.
Chainlink DMI Shows Sellers Took Control
According to Chainlink’s DMI chart, its ADX (Average Directional Index) has decreased from 26 yesterday to 20.46 today. This decline indicates weakening trend strength regardless of direction.
ADX is a component of the Directional Movement Index (DMI) that quantifies trend strength on a scale of 0-100, without indicating direction. Generally, readings above 25 suggest a strong trend, 20-25 indicate a developing trend, and below 20 reflect a weak or absent trend.
Chainlink’s ADX moving from above 25 to just above 20 signals that the previous strong trend is losing momentum and shifting toward a more neutral or ranging market.
The Positive Directional Indicator (+DI) has fallen significantly from 33.3 to 20.1, while the Negative Directional Indicator (-DI) has increased from 14.2 to 21. This crossover, with -DI now exceeding +DI, suggests a potential shift from bullish to bearish momentum.
Combined with the weakening ADX, this technical picture points to a likely bearish reversal or continuation pattern forming for LINK’s price. Traders might anticipate further downside pressure in the near term, though they should monitor for stabilization or reversal signals as the trend weakens.
LINK BBTrend Is Now Positive After Staying Negative For Several Days
LINK’s BBTrend has now turned positive, reaching 3.69 after remaining in negative territory since March 4. A significantly negative reading of -20 was recorded on February 28.
The BBTrend (Bollinger Bands Trend) indicator is a momentum oscillator that measures the relationship between price and Bollinger Bands to identify trend strength and direction. It calculates how price is moving relative to the Bollinger Bands, which themselves represent standard deviations from a moving average.
When BBTrend is positive, it suggests prices are moving above the middle band and potentially toward the upper band, indicating bullish momentum.
Conversely, negative readings suggest bearish pressure with prices moving below the middle band toward the lower band. The recent shift to a positive 3.69 BBTrend value for LINK could signal emerging bullish momentum after a period of downward pressure.
This reversal, coming after an extended negative period that bottomed at -20, might indicate a meaningful change in market sentiment.
However, traders should confirm this signal with other indicators, as the relatively modest positive reading of 3.69 suggests the bullish momentum is still developing rather than strongly established.
Will Chainlink Go Back To $20 In March?
LINK EMA (Exponential Moving Average) lines are currently trending downward, potentially forming a death cross in the near future.
If this bearish pattern materializes and Chainlink price breaks below the critical support level at $15.79, we could see further downside movement.
In this scenario, LINK might decline to test psychological and technical support levels at $14 and potentially even $13.45, representing significant drops from current prices.
Conversely, the recent positive shift in BBTrend suggests growing buying pressure may be building. If this bullish momentum continues to strengthen, LINK could challenge the immediate resistance at $17.64.
A decisive break above this level would open the path to test higher resistance zones at $19.79 and, subsequently, $22.31. In a strongly bullish scenario where upward momentum accelerates, Chainlink could potentially reach $26.4, which would mark its first time trading above $25 in over a month.
This technical setup presents a clear inflection point for LINK, with convincing breaks of either the support at $15.79 or resistance at $17.64, likely determining the next significant price movement.
