On March 2, Trump announced in a post that cryptocurrencies would become strategic reserve assets for the United States, saying that he wanted to "save the cryptocurrency industry that has been suppressed under the Biden administration." In the post, he mentioned BTC, ETH, as well as altcoins such as XRP, SOL, and ADA. As soon as the news came out, coupled with the fermentation and hype on social media, the price of tokens in the entire crypto market soared.
Industry leaders have mixed opinions
In this regard, cryptocurrency industry leaders and analysts have expressed different opinions. Coinbase CEO Brian Armstrong said he wants to know more details and is still considering how to allocate assets.
Armstrong believes that it may be most reliable to just buy Bitcoin, after all, Bitcoin is like digital gold, simple and clear. If you want to diversify your investment, it is recommended to create a cryptocurrency market value index, but he believes that buying Bitcoin alone may be a better choice.
Raoul Pal, CEO of Real Vision, agrees with this view. He thinks it is possible to create a US cryptocurrency market capitalization index that includes BTC and ETH, which would be fair and allow the market to decide its purchasing intentions.
But Samson Mow, a staunch supporter of Bitcoin, was unhappy. He said that Trump's post also mentioned altcoins, which was a sad day for the United States. He believed that if the United States did not pay more attention to Bitcoin, it would be a big loss for the United States.
He also added that considering Trump has previously launched meme coins, he is not surprised that he mentioned these altcoins. The era of super shitcoins is coming.
Arthur Hayes, the founder of BitMEX, was a little calmer. He believed that Trump was just talking. The plan would need to obtain approval from Congress to borrow money or wait for the gold price to rise before it could be implemented. Without these prerequisites, the government would have no money to buy Bitcoin and these "junk" tokens.
Trader and senior analyst "DonAlt" was more direct, saying that Trump's plan might fail and there is a high possibility of being rejected. He also said that if the plan is really successful, those altcoins may rise 3 to 4 times, but if it is unsuccessful, they may fall by 25%.
Because of this news, the cryptocurrency market has also changed. The prices of those altcoins have soared, and Bitcoin's market share has also declined. According to data from Tradingview, on Sunday, Bitcoin's market share had dropped to a little over 60%, much lower than 64% in early February.
However, Trump’s cryptocurrency reserve plan still needs to be approved by Congress before it can be truly implemented, so it is still a long way from being truly implemented!
Conclusion:
Trump's proposed "cryptocurrency reserve" has undoubtedly caused a stir in the crypto community. On the one hand, this plan has brought more attention and potential capital inflows to the cryptocurrency industry, especially the status of Bitcoin and Ethereum as "digital gold" and "smart contract platform" has been further strengthened.
However, the proposal to include altcoins such as XRP, SOL, and ADA in the reserve pool has sparked widespread controversy in the industry. Many experts believe that this approach may dilute the core value of Bitcoin and even expose national reserves to high-risk altcoin fluctuations.
Judging from the market reaction, the short-term surge in altcoins and the decline in Bitcoin's dominance reflect investors' mixed emotions about the news. However, whether Trump's plan can actually be implemented still depends on the results of the congressional vote. At present, this proposal is more of a political statement than an immediately feasible policy.
In any case, this incident once again highlights the importance of cryptocurrencies in the global financial system and allows us to see the game between policymakers and market participants. In the future, how the regulation and adoption of cryptocurrencies will evolve remains uncertain.
💬What do you think of Trump’s “Strategic Cryptocurrency Reserve” plan? Do you think altcoins should be included in national reserves? If this plan does go through, how do you think the market will react?
