WEST PALM BEACH, Florida (Reuters) – On Sunday, U.S. President Donald Trump took to social media to disclose the names of five digital currencies he plans to include in a proposed U.S. strategic reserve for cryptocurrencies. This announcement led to a significant increase in the market value of each asset mentioned.
In a post on Truth Social, Trump stated that his executive order from January regarding digital assets aims to establish a stockpile comprising Bitcoin, Eth, XRP, Solana, and Cardano—names that had not been previously revealed.
Shortly thereafter, Trump reiterated that “obviously, BTC and ETH will be central to the Reserve,” emphasizing their importance.
Following Trump’s announcement, Bitcoin—the largest cryptocurrency by market capitalization—surged over 11%, reaching $94,164 by Sunday afternoon. Ether, the second-largest cryptocurrency, experienced a similar boost of approximately 13%, climbing to $2,516.
According to CoinGecko, a cryptocurrency data and analysis firm, the total cryptocurrency market has seen an increase of around 10%, translating into over $300 billion in value since Trump’s revelation.
XRP is the token associated with Ripple Labs. Notably, Ripple has supported a super PAC aimed at influencing congressional elections this November in favor of advancing crypto interests.
“This initiative marks a pivotal shift toward active engagement by the U.S. government in the cryptocurrency economy,” remarked Federico Brokate, head of U.S. business at 21Shares—a digital asset investment management firm. “It could catalyze institutional adoption while providing greater regulatory clarity and reinforcing America’s leadership role in digital asset innovation.”
James Butterfill, head of research at asset manager CoinShares, expressed surprise at the inclusion of cryptocurrencies beyond Bitcoin in this reserve. He noted: “Unlike Bitcoin… these assets resemble technology investments more than pure cryptocurrencies.” His comments suggest that Trump’s approach reflects a more patriotic view towards broader crypto technology rather than focusing solely on fundamental qualities.
As Trump campaigns for re-election in 2024, he has garnered support from the crypto industry and swiftly aligned himself with their policy priorities. He is set to host the first White House Crypto Summit on Friday and his family has introduced their own cryptocurrencies.
In contrast to his Democratic predecessor Joe Biden’s administration—which imposed stricter regulations aimed at safeguarding Americans against fraud and money laundering—Trump’s administration appears more lenient. The Securities and Exchange Commission under Trump has notably withdrawn investigations into several crypto companies and dismissed legal action against Coinbase (NASDAQ:COIN), America’s largest cryptocurrency exchange.
However, recent weeks have seen sharp declines in cryptocurrency prices; many leading digital currencies have almost completely erased gains achieved following Trump’s election victory which initially excited investors.
Analysts indicate that for the market to rebound substantially it may require catalysts such as indications from the U.S. Federal Reserve about potential interest rate cuts or clearer pro-cryptocurrency regulations from Trump’s administration.
Geoff Kendrick of Standard Chartered (OTC:SCBFF) predicts that Bitcoin could reach as high as $500,000 before Trump concludes his term—a significant increase from its record high of $109,071.
Regulatory filings indicate that while hedge funds remain primary purchasers of cryptocurrencies in the U.S., banks and sovereign wealth funds are also entering this space. Quarterly reports show asset managers increased their allocations toward U.S.-based ETFs linked to spot Bitcoin prices during Q4 2024.
There remains debate among analysts and legal experts regarding whether Congressional action will be necessary for establishing this reserve; some propose it could be set up through the U.S. Treasury’s Exchange Stabilization Fund designed for foreign currency transactions.
Additionally, Trump’s crypto group is exploring options for creating this stockpile using cryptocurrencies seized during law enforcement activities.