What happened?
U.S. President Donald Trump announced the establishment of a “U.S. Crypto Reserve” on the social platform Truth Social, which includes Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Solana (SOL), and Cardano (ADA). Many cryptocurrency investors believe that the reserve should only hold Bitcoin, while others argue that there should be no idea of holding digital assets in a reserve at all.
Trump Promotes “U.S. Crypto Reserve,” Bitcoin Soars
Recently, U.S. President Donald Trump announced that the United States will establish a “Crypto Strategic Reserve,” naming five cryptocurrencies to be included in the reserve: Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Solana (SOL), and Cardano (ADA).
Upon this announcement, the market reacted immediately, with the prices of these five cryptocurrencies surging. XRP saw an increase of up to 33%, SOL rose by 25%, and ADA skyrocketed by over 60%. Trump stated on Truth Social, “The U.S. Crypto Reserve will elevate this important industry and combat the corruption suppression by the Biden administration for years. I will ensure that America becomes the global cryptocurrency capital and make America great again!” The “Crypto Strategic Reserve” is a new concept similar to the Strategic Petroleum Reserve, but instead of storing crude oil, it will store cryptocurrencies like Bitcoin and Ethereum. The goal is for the U.S. government to hold and manage specific cryptocurrencies to enhance national competitiveness and promote the development of the cryptocurrency industry. In fact, Trump had previously mentioned at the 2024 Bitcoin Conference his desire to establish a “strategic Bitcoin reserve,” expressing that Bitcoin is likely to surpass gold’s $20 trillion market cap. However, this is the first time Trump has explicitly supported the establishment of a “Reserve” rather than a “Stockpile.”
A “Reserve” implies that the government will regularly purchase cryptocurrencies, whereas a “Stockpile” refers to retaining existing holdings without selling.
Market Turbulence: Bitcoin Breaks $90,000, Ethereum Strongly Recovers
Before Trump’s post, Bitcoin’s price had briefly fallen below $80,000, reaching a three-month low. However, following Trump’s announcement, Bitcoin’s price rapidly climbed to $94,000, with a single-day increase of over 10%. Ethereum also rebounded by 13%, escaping the sluggish trend it had experienced since the beginning of the year. This indicates that investors have high expectations for government support of cryptocurrencies, and more funds may flow into the market in the future. The market generally believes that Trump’s policies will bring significant changes to the cryptocurrency industry. Federico Brokate, head of U.S. operations for investment firm 21Shares, stated, “The establishment of a cryptocurrency reserve by the U.S. government represents a new phase of interaction between the government and the cryptocurrency industry. This is a pivotal moment.” However, not everyone is excited about Trump’s decision. Some investors believe that the cryptocurrency reserve should only include Bitcoin, as it is the most decentralized digital asset; others worry that government intervention may lead to market manipulation or even turn cryptocurrencies into policy tools.
Uncertainties in Cryptocurrency Policy, Trump to Hold White House Crypto Summit
Trump plans to hold a “Cryptocurrency Summit” at the White House this Friday (March 7), where he will further elaborate on the details of the “U.S. Crypto Reserve,” including how it will operate, methods of purchase, and whether Congressional approval is needed. It remains unclear whether the government will actively purchase these digital assets or only retain cryptocurrencies that are seized legally. Notably, Trump has previously criticized Bitcoin, even calling it a “scam” during a media interview in 2021. However, recently he and his family have actively engaged in cryptocurrency, launching their own meme coin and planning to enter decentralized finance (DeFi). Additionally, Trump’s media company, Trump Media & Technology Group (TMTG), plans to launch a Bitcoin exchange-traded fund (ETF) to compete with Wall Street giants. If the “U.S. Crypto Reserve” is successfully established, it could propel the U.S. to become the “global cryptocurrency capital.” This is particularly relevant as many cryptocurrency companies are choosing to relocate their headquarters to Singapore, the UAE, or Europe, where the regulatory environment is more favorable. If the Trump administration actively promotes policy reforms, it may attract businesses back to the U.S., strengthening its leadership in the Web3, blockchain technology, and digital asset markets. Analysts point out that although Trump currently fully supports cryptocurrencies, future political changes could still impact the direction of policy implementation. For instance, if a new government takes office, it may choose to sell reserves to address fiscal deficits or alter the overall policy direction. Therefore, the market must closely monitor subsequent developments. Trump’s “U.S. Crypto Reserve” plan undoubtedly injects a strong dose of optimism into the market, driving up cryptocurrency prices. However, whether government intervention in the crypto market will impact the spirit of decentralization remains to be seen. With the White House cryptocurrency summit approaching, the market will closely watch the Trump administration’s specific plans, as whether the U.S. can truly become the “cryptocurrency capital” depends on how specific policies are implemented and how the future international financial landscape evolves.
Sources: Forbes, CNBC, BBC