In the past week, Bitcoin and crypto prices—including Ethereum, Ripple’s XRP, Solana’s SOL, and Cardano’s ADA—have remained stagnant following Donald Trump’s announcement about the U.S. cryptocurrencies, which ignited chaos in the market.
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The Bitcoin price has dropped back to nearly $85,000 per bitcoin, mirroring its value from early March (despite China’s discreet maneuvers to prepare Bitcoin for significant shifts).
As Elon Musk issues a surprise warning about crypto prices, Donald Trump’s cryptocurrency advisor has indicated that the U.S. Treasury plans to work towards “maximizing the value” of Bitcoin and other cryptos held within the country’s reserves and crypto inventory.
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President Donald Trump has declared his intention to establish the U.S. as the world’s Bitcoin “superpower,” with cryptocurrency prices like XRP, Solana, Cardano, and Ethereum preparing for significant changes.… [+]
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“We’re going to transition the [cryptocurrency owned by the U.S. government] to the digital stockpile,” said David Sacks, a tech investor and entrepreneur appointed by Trump as the artificial intelligence and crypto czar, during a prior All In Podcast episode.
“The aim of the stockpile is responsible management; it serves as a secure location under the supervision of the Treasury Secretary, who will determine how to optimize the value of these assets.”
Following Trump’s unexpected announcement that Ripple’s XRP, Solana, and Cardano would serve as the basis for a U.S. cryptocurrency reserve, the administration has revised its plans to create a bitcoin-only strategic reserve, in addition to a diversified crypto stockpile including Ethereum, Ripple’s XRP, Cardano, and Solana.
“The crypto stockpile should benefit from sound portfolio management; luckily, we have a Treasury Secretary who is an accomplished former hedge fund manager, so he will figure out the best way to handle these assets while allowing for flexible portfolio management,” Sacks noted.
Addressing the much-anticipated White House crypto summit alongside Sacks and Treasury Secretary Scott Bessent, Trump reiterated his commitment to Bitcoin, emphasizing its unique status over other cryptocurrencies and referring to it as a “digital Fort Knox,” akin to the U.S. gold reserve.
“I vowed to make America the Bitcoin superpower globally and the cryptocurrency capital of the world,” Trump stated, as reported by the New York Times. “We are taking groundbreaking actions to fulfill that promise.”
During a July appearance at the Bitcoin 2024 conference, then-presidential candidate Donald Trump promised to establish a “strategic national Bitcoin reserve” and forecasted that Bitcoin could surpass gold’s near-$20 trillion market capitalization.
At the White House summit, Trump described the government’s previous sales of significant amounts of seized Bitcoin as “foolish,” while Sacks claimed that the U.S. might have forfeited up to $16 billion by liquidating its Bitcoin holdings.
“At one point, we had around 400,000 Bitcoin on the federal balance sheet, of which we sold about half for a total of approximately $360 million,” Sacks remarked during the podcast. “Had we retained all of those, the portion sold would now be worth more than $17 billion.”
Ahead of the summit, Trump signed an executive order aimed at crafting the Bitcoin reserve and crypto stockpile utilizing existing governmental assets, leaving traders dissatisfied with a lack of commitment to new Bitcoin and crypto acquisitions but keeping the option of acquiring more Bitcoin through “budget-neutral” channels that “do not impose additional costs on U.S. taxpayers.”
Sacks further clarified during a press conference that the Treasury and Commerce departments, under Bitcoin advocate Howard Lutnick’s leadership, can only “purchase more if it doesn’t contribute to the deficit or debt.”
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The Bitcoin price has declined from its peak following Donald Trump’s election victory, resulting in a downward pull on Ethereum, XRP, Solana, Cardano, and the broader crypto market.… [+]
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“The mediocre strategic Bitcoin reserve initiative has instigated uncertainty within the crypto market,” said Agne Linge, head of growth at crypto platform WeFi, in an email.
“With the executive order directing agencies to consolidate seized Bitcoin into a reserve, crypto investors perceive it as a ruse since no new Bitcoin purchases were mentioned. Despite the immediate response from investors, the Bitcoin reserve mandate does allow for acquisitions through means that won’t financially burden taxpayers. Potential methods include Bitcoin bonds or divesting from its gold reserves to facilitate additional purchases. If executed well, this reserve shift could ultimately benefit Bitcoin, especially if it spurs other countries to adopt similar strategies.”
Speculation has surfaced that China is considering establishing its own Bitcoin reserve in competition with the U.S. after Abu Dhabi’s sovereign wealth fund publicized its inclination to invest in Bitcoin, igniting a global adoption “race.”
“The establishment of the U.S. Bitcoin reserve increases the probability that other nations will set up similar reserves and speeds up their deliberations on such actions,” stated analysts from Tagus Capital in an email.
“With the U.S. committing to adopt Bitcoin reserves, it’s likely to spur wider global acceptance, prompting more nations to incorporate Bitcoin into their reserves—possibly transitioning from gold to digital assets, reminiscent of how some economies have adopted the U.S. dollar alongside or instead of their local currencies.”
