#BitcoinPolicyShift

Why did the cryptocurrency market crash after the announcement of a reserve?

The prices of major cryptocurrencies fell sharply in the past 24 hours after U.S. President Donald Trump announced the creation of a strategic reserve of Bitcoin, disappointing traders who had hoped that the reserve would be funded by new purchases, not by seized assets.

Bitcoin (BTC) lost about 4.9% of its value, reaching $87,200 after plummeting from $90,200 the night before. Ethereum (ETH) also dropped by 5.3%, while XRP, Dogecoin (DOGE), and Cardano (ADA) fell by up to 9%.

This drop came after days of upward momentum fueled by Trump's previous statements, which sparked speculation about the possibility of the U.S. government adopting currencies like XRP, ADA, and SOL as part of the strategic reserve.

However, the recent announcement limited the reserve to Bitcoin only, leading the market into a wave of collective selling.

Why did the cryptocurrency market crash after the announcement of the creation of a reserve for the crypto project?