Trump announces cryptocurrency reserve plan: 5 types of assets are selected, but they are questioned by "advertising spaces", and there is uncertainty in the implementation method

Author: Weilin, PANews

On the evening of March 2, US President Trump announced the asset classes of cryptocurrency strategic reserves at Truth Social, including XRP, SOL, and ADA. He then added that Bitcoin BTC and Ethereum ETH, as other valuable cryptocurrencies, will also become the core of the reserves.

Once this news was announced, the cryptocurrency market rebounded rapidly, and the five major currencies generally rose. As of 8:00 on March 3, the price of Bitcoin exceeded $94,000, up 9.71% during the day.

Trump announces 5 types of assets in crypto assets reserves: BTC, ETH,

XRP, SOL, ADA

On March 2, amid a general market downturn, Trump suddenly issued a statement on cryptocurrency reserves: "U.S. cryptocurrency reserves will enhance this key industry after years of corruption attacks by the Biden administration. That's why my executive order for Digital Assets directs the Presidential Working Group to advance crypto strategic reserves including XRP, SOL and ADA. I will ensure that the United States becomes the crypto capital of the world. We are making the United States great again!"

The crypto market then received a significant boost. As of 8:00 on March 3, Bitcoin was quoted at $94,338, up 9.71%; Ethereum was quoted at $2,513, up 13.41%; Solana (SOL) rose to $178, up 24.35%; XRP rose to $2.91, up 33%; Cardano (ADA) rose sharply 72.16%. In addition, Trump's meme coin TRUMP also rose by 25.36%.

Trump promised to build a "strategic reserve of Bitcoin" at the Bitcoin Conference in Nashville in 2024. In the keynote speech, Trump told the audience: “If I were elected, my administration’s policy is to keep 100% of all Bitcoins currently held or acquired in the U.S. government.”

On January 23 this year, within the first week of Trump's take office, he signed an crypto executive order as president, directing the Digital Assets Working Group to study the feasibility of establishing national crypto reserves and explore the regulatory framework for stablecoins.

"President Trump announced the establishment of a strategic cryptocurrency reserve composed of bitcoin and other top cryptocurrencies. This is consistent with his first week executive order 14178," wrote David Sacks, head of artificial intelligence and cryptocurrency at the White House, wrote on the X platform. “More news will be released during the summit,” he added.

It is reported that President Trump will attend the first White House Cryptocurrency Summit on March 7 and deliver a speech. Attendees will include well-known founders, CEOs and investors in the cryptocurrency industry, as well as members of the President’s Digital Assets Working Group. The summit will be chaired by White House AI and cryptocurrency Tsar David Sacks, and will be managed by Bo Hines, executive director of the task force.

Is there a "transfer of interests" when tilting towards multiple assets?

The implementation method remains to be clarified

Although the latest developments in cryptocurrency strategic reserves have brought a boost to the market, some industry insiders have questioned Trump's cryptocurrency reserve plan. In particular, the selection of ADA has caused some unexpected responses. According to @CryptoDoggyCN, in early February, ADA founder Charles Hoskinson previewed himself meeting with a big man on a live broadcast. On February 27, he posted that he could not go to ETHDenver and wanted to go to Florida, and Trump's home Mar-a-Lago is in Florida. @CryptoDoggyCN believes that the ADA's selection may be affected by a kind of lobbying.

Some influential figures in the technology and crypto industry have criticized Trump for including cryptocurrencies other than Bitcoin into his reserves. "U.S. taxpayers should not 'take over' for those nominally decentralized cryptocurrencies," wrote AngelList co-founder Naval Ravikant. He added: "If it has lobbyists, it's not decentralized." Aave founder Stani Kulechov also wrote: "Good news: strategic crypto reserves are in preparation; bad news: lack of DeFi; ugly news: XRP, SOL and ADA."

Alex Xu, research partner at Mint Ventures, analyzed that SOL, XRP, and ADA have been running to Mar-a-Lago after Trump took office, and have also provided Trump with a lot of open sponsorships, such as donations for inauguration ceremony funds, etc. There is a high probability that various roundabout transfers of interests will be more likely. Trump also reciprocated this time, gave open feedback, and arranged an "advertising space" within the president's authority. However, in the long run, projects such as ada and xrp can be used as reserve assets to promote them. This absurd approach will only weaken the seriousness of BTC strategic reserves itself and further reduce the possibility of the BTC reserve bill being passed at the federal level. It is one thing to let the working group advance its work, and it is another thing to succeed at the legislative level. The Republicans have very weak advantages in the House of Representatives, and it is impossible to have the ability to pass sol, ada, and xrp legislation and enter the national reserves. The only possibility is that Trump establishes a national sovereign fund directly under the Ministry of Finance through an executive body, so that the above assets can be purchased directly without federal legislation. But how big is this possible? How much benefit does SOL, XRP and ADA have to deliver to the Trump family before the president can make the explicit order to use taxpayers’ money to buy these things?

In addition, some industry insiders pointed out that in the past few months, when Trump mentioned relevant policies, the words "reserve" and "stockpile" have been used alternately, but there are some key differences between them. "In my understanding, storage means that the government will hold the cryptocurrency they have accumulated through various cases, and the reserves are ultimately what the Treasury decides to buy and hold," said Rebecca Rettig, chief legal officer at Jito Labs.

Analyst Chen Jian Jason said on the X platform that there is a very uncertain factor in the package of cryptocurrency strategic reserve plans, what means can be used to complete the reserves? According to Trump's extremely selfish style, he has always adhered to the principle of not spending money if he can get free so that he can buy money. It is difficult to expect him to take out the money in his pocket and buy it to complete the reserves and then "pull the market". The US fiscal deficit reaches 1.83 trillion US dollars, and the landlords have no surplus food. Therefore, Trump is likely to complete the reserves by not spending money, such as requiring the government to no longer sell the BTC held by himself, allowing cryptocurrency-related companies to use BTC to pay taxes, and even actively pay it through donations.

He said that he may reserve APT, SUI, MOVE, etc. in the future. If the money is not used to complete the reserves, the essential nature of the benefit is equivalent to locking up positions, that is, the funds flowing into the strategic reserves will not be sold again for a long time, such as offsetting the negative news that the US government was most worried about before, and will not really use money to throw in and pull the market like BlackRock and MicroStrategies.

Despite this, on March 3, former Binance CEO Zhao Changpeng posted an article on the X platform to express his observations on the current market. The current market is clearly dominated by "US crypto assets" (US Coins). They have promoted the development of cryptocurrency. It is very happy to see any progress made in cryptocurrency adoption, the industry as a whole will benefit and continue to build.

"I think investing in Bitcoin alone is probably the best option - the easiest, and the logic behind it is clear as well as being the successor of gold; if people want more diverse options, they can build a market-weighted crypto asset index to keep it unbiased. But maybe the first option is the easiest."

At present, the five categories of crypto asset reserves announced by Trump have injected optimism into the market, but their implementation methods and specific results still need time to be tested. The market will further verify them in the future. PANews will closely monitor subsequent updates.