- Crypto markets gained $180B in 24 hours post-announcement
- Plan includes XRP, Solana, and Cardano alongside Bitcoin/ETH
- U.S. would leverage 214k seized Bitcoin worth $19B
- Debate grows over crypto’s viability as national reserve asset
- White House Crypto Summit scheduled amid regulatory shifts
The cryptocurrency market experienced dramatic volatility this week after former President Trump proposed creating a federal digital asset reserve. Bitcoin surged past $90,000 within hours of the Sunday night announcement, recovering from a recent low of $79,400. Analysts note the 13% price swing marks Bitcoin’s largest single-day gain since November 2023.
Trump’s expanded vision for a “Crypto Strategic Reserve” breaks new ground by incorporating altcoins like XRP (+47%) and Solana (+39%), which outperformed market leaders initially. The proposal would combine existing seized assets with new purchases, though funding mechanisms remain unclear. Treasury officials declined to confirm whether this would involve direct market purchases or asset seizures.
Industry reactions highlight deepening political divisions. “This validates crypto’s role in modern finance,” said Eric Trump, referencing his recent investment advice. Meanwhile, Biden-era SEC regulators warn that mixing volatile assets with national reserves could destabilize traditional markets. Singapore’s sovereign wealth fund recently abandoned similar crypto reserve plans after 18-month trials showed 300% higher volatility than gold.
Controversy surrounds the inclusion of meme coins like “TrumpCoin,” which briefly became a $2B market cap asset before crashing 92% post-inauguration. The Argentine Central Bank condemned last week’s “MileiCoin” collapse, linking it to broader LATAM crypto instability. North Korea’s alleged hacking of a Japanese exchange further complicates security discussions ahead of Friday’s White House summit.
Market analysts identify three critical implications: 1) Crypto is becoming a geopolitical bargaining chip 2) Retail investors face increased scam risks during political pumps 3) Stablecoin legislation may accelerate as governments seek price stability. The Chicago Mercantile Exchange reports open interest in crypto futures has doubled since January, suggesting institutional players are positioning for long-term policy impacts.
