Recent developments regarding the cryptocurrency strategic reserve have provided a boost to the market, but some industry insiders have raised questions about Trump’s plan, pointing out its tilt towards various assets and whether there exists a potential for “interest transfer.” The implementation method remains to be clarified.
(Background: Arthur Hayes expresses pessimism about Trump’s establishment of Bitcoin and altcoin reserves: the U.S. government has no money and is merely talking.)
(Background: Trump’s call to advance “XRP, SOL, and ADA strategic reserves” leads to a market surge, with Bitcoin surpassing $89,000.)
On the evening of March 2, U.S. President Trump announced on Truth Social the asset categories for the cryptocurrency strategic reserve, which include XRP, SOL, and ADA. He further added that Bitcoin (BTC) and Ethereum (ETH), as other valuable cryptocurrencies, will also become core components of the reserve.
Upon the announcement, the cryptocurrency market quickly rebounded, with the five major coins generally rising. As of 8 AM on March 3, the price of Bitcoin exceeded $94,000, an increase of 9.71% on the day.
Trump announced five assets for the cryptocurrency reserve: BTC, ETH, XRP, SOL, ADA.
On March 2, amidst a generally sluggish market, Trump suddenly released a statement regarding the cryptocurrency reserve: “The U.S. cryptocurrency reserve will elevate this critical industry after years of corruption attacks by the Biden administration. That is why my digital asset executive order directs the presidential working group to advance a cryptocurrency strategic reserve that includes XRP, SOL, and ADA. I will ensure that America becomes the world’s crypto capital. We are making America great again!”
Subsequently, the cryptocurrency market experienced significant uplift. As of 8 AM on March 3, Bitcoin was priced at $94,338, up 9.71%; Ethereum was priced at $2,513, up 13.41%; Solana (SOL) rose to $178, an increase of 24.35%; XRP climbed to $2.91, up 33%; Cardano (ADA) rose 27%. Furthermore, Trump’s meme coin TRUMP also surged by 25.36%.
Trump previously promised to establish a “Bitcoin Strategic National Reserve” at the Bitcoin conference held in Nashville in 2024. In his keynote address, Trump told the audience: “If I am elected, my government’s policy will be to retain 100% of all Bitcoin currently held or acquired by the U.S. government.”
On January 23 of this year, within his first week in office, Trump signed an executive order directing a digital asset working group to explore the feasibility of establishing a national cryptocurrency reserve and to investigate the regulatory framework for stablecoins.
“President Trump announced the establishment of a cryptocurrency strategic reserve composed of Bitcoin and other top cryptocurrencies. This aligns with his executive order 14178 issued in his first week,” wrote David Sacks, the White House AI and crypto affairs head, on the X platform. He added, “More announcements will be released during the summit.”
It is reported that President Trump will attend the first White House Cryptocurrency Summit on March 7 and deliver a speech. Participants will include prominent founders, CEOs, and investors from the cryptocurrency industry, as well as members of the presidential digital asset working group. The summit will be hosted by David Sacks, the White House AI and cryptocurrency czar, and managed by Bo Hines, the working group’s executive director.
With a tilt towards various assets, is there a possibility of “interest transfer”? The implementation method remains to be clarified.
Despite the recent advancements in the cryptocurrency strategic reserve bringing a boost to the market, some industry insiders have expressed skepticism about Trump’s cryptocurrency reserve plan. Notably, the inclusion of ADA has sparked some unexpected reactions. According to @CryptoDoggyCN, Charles Hoskinson, the founder of ADA, hinted during a livestream in early February that he would meet with a significant figure. On February 27, he posted that he could not attend ETHDenver and was heading to Florida, where Trump’s Mar-a-Lago estate is located. @CryptoDoggyCN believes that ADA’s inclusion may have been influenced by lobbying.
Some influential figures in the tech and crypto industry criticized Trump’s inclusion of cryptocurrencies other than Bitcoin in the reserve. Naval Ravikant, co-founder of AngelList, wrote, “U.S. taxpayers should not be ‘bailing out’ those ostensibly decentralized cryptocurrencies.” He added, “If it has lobbyists, then it is not decentralized.” Aave founder Stani Kulechov also stated, “Good news: strategic crypto reserves are in preparation; bad news: DeADA, DeADAX.”
Alex Xu, a research partner at Mint Ventures, analyzed that SOL, XRP, and ADA have been frequently visiting Mar-a-Lago since Trump’s presidency began and have provided Trump with many visible endorsements, such as donations to inauguration funds, etc. The likelihood of various indirect interest transfers only increases. Trump this time reciprocated by providing visible returns, arranging a “advertisement space” within presidential authority.
However, in the long run, projects like ADA and XRP could be used as reserve assets. This absurd practice will only undermine the seriousness of the BTC strategic reserve itself and further reduce the likelihood of the BTC reserve bill passing at the federal level. Advancing the working group’s efforts is one thing, but achieving legislative success is another. The Republican advantage in the House is very slight, making it virtually impossible to legislate the inclusion of SOL, ADA, and XRP into the national reserve.
The only possibility is that Trump establishes a national sovereign fund directly under the Treasury through executive agencies, allowing the direct purchase of the above assets without federal legislation. But how likely is this? How much benefit must SOL, XRP, and ADA deliver to the Trump family for the President to explicitly order the purchase of these assets with taxpayer money?
Furthermore, some insiders pointed out that over the past few months, when Trump mentioned related policies, the terms “reserve” and “stockpile” have been used interchangeably, yet there are key distinctions between them. Rebecca Rettig, chief legal officer of Jito Labs, stated, “As I understand it, ‘stockpile’ means the government will hold the cryptocurrencies they accumulate through various cases, whereas ‘reserve’ ultimately refers to what the Treasury decides to purchase and hold.”
Analyst Jason Chen expressed on the X platform that a significant uncertainty in the bundled cryptocurrency strategic reserve plan is through what means the reserve will be completed. Following Trump’s extremely self-serving business style, which adheres to the principle of not spending money if something can be obtained for free, it is difficult to expect him to genuinely pull out money from his pocket to buy assets for the reserve and subsequently “pump” the market. With the U.S. fiscal deficit reaching $18.3 trillion, the Trump administration has little leeway, so it is highly likely that Trump will resort to a reserve method.
He indicated that in the future, assets like APT, SUI, and MOVE might be reserved. If no money is put forth to complete the reserve, then the nature of this favorable development is essentially equivalent to locking assets, meaning the funds flowing into the strategic reserve will not be sold for an extended period, thereby offsetting the market’s prior concerns about the U.S. government’s potential sell-off, rather than genuinely injecting funds like BlackRock or MicroStrategy.
Nonetheless, on March 3, Binance’s former CEO Changpeng Zhao shared his observations on the current market on the X platform, noting that the market is clearly dominated by “U.S. crypto assets” (US Coins), which have driven the development of cryptocurrency. He expressed happiness to see any progress in cryptocurrency adoption, benefiting the industry overall, and encouraged continued building.
Coinbase co-founder and CEO Brian Armstrong, when discussing investment strategies on the X platform, stated, “I believe that investing solely in Bitcoin may be the best option—it’s the simplest, and the logic behind it as the successor to gold is very clear; if people want more diversified options, they could build a market-cap-weighted cryptocurrency index to maintain its impartiality. But the first option is probably the simplest.”
Currently, Trump’s announcement of the five categories of cryptocurrency reserves has injected optimism into the market, but the implementation methods and specific outcomes still require time for evaluation. The future market will further validate these developments, and PANews will closely monitor the subsequent dynamics.
