Is it profit transfer or just a big order? Trump officially announces the list of crypto strategic reserves

Trump, here to put out the fire.

The market has been on a roller coaster ride, and last week was no exception. Under the internal and external pressure of tariffs and theft, market panic spread rapidly. The always strong BTC fell below $80,000, ETH came to around $2,200, and the copycat leaders BNB and SOL were overwhelmed and returned to the detonation point prices at the end of last year.

Amid the wailing, the "savior" Trump sent another shot in the arm. Perhaps because the second stock market, the currency circle, which represents political achievements, was too sluggish, it was a bit embarrassing. Trump issued a message last Sunday, once again putting the crypto strategic reserve on the agenda, saying that he would speed up the promotion of crypto reserves including five major currencies. In other words, the crypto reserve is a foregone conclusion, and the market has lived up to expectations and ushered in a rapid rebound.

But to make reserves, it is not as simple as the president talking.

After BTC fell below $80,000 on Friday, the market sentiment dropped to the freezing point. Discussions about the bull market turning into a bear market continued, and the negative fluctuations became the main theme of many currencies. The market even began to pay attention to the shutdown price of mining machines, which shows the downturn. But Trump is the reason for success and Trump is the reason for failure. The value of this sentence is still rising.

Just last night, the Bitcoin President of the United States, Trump, could not sit still. Trump posted on his own Truth Social, saying, "The U.S. Crypto Reserve will elevate this critical industry and free it from years of corrupt suppression by the Biden administration. Therefore, my Executive Order on Digital Assets instructs the Presidential Working Group to advance the establishment of a Crypto Strategic Reserve, which will include XRP, SOL and ADA. I will ensure that the United States becomes the global cryptocurrency capital. We are making America great again!" This is not the first time that the Crypto Strategic Reserve has been mentioned in the United States. Since Trump promised to establish a reserve at the Bitcoin conference in October last year, there has been no shortage of news about crypto reserves. Whether it is the purchase of 1 million BTC proposed by US Senator Cynthia Lummis, or the so-called crypto reserve construction framework that has been circulated subsequently, they are constantly adding bricks and tiles to the US crypto reserve expectations. Although the president did not list the matter as a very high priority after taking office, and crypto was not among the top 100 executive orders, on January 24, Trump still handed in this pledge of allegiance to crypto. He signed a document entitled "Strengthening America's Leadership in Digital Financial Technology" and will establish a presidential working group, which clearly states that within 180 days of the date of the issuance of the order, the working group should submit a final report and proposal to the president, including the development of a complete federal regulatory framework to regulate the issuance and operation of digital assets (including stablecoins) in the United States. At the same time, the possibility of establishing and maintaining a national digital asset reserve should be evaluated, and standards for establishing such a reserve should be proposed. The reserve may come from cryptocurrencies legally seized by the federal government through law enforcement.

At that time, because the reserves came from legal seizures rather than incremental purchases, and there was still room for operation for a period of time, the market was not happy with this, and even felt disappointed. With the liquidity crisis brought about by its coin issuance and subsequent policy proposals, the crypto reserves were gradually not mentioned, and industry insiders also expressed extreme dissatisfaction with the president's harvesting-style money-making, and the former support and love gradually turned into hatred for money-grabbing.

But just when the market was sluggish, the strategic reserves were mentioned again, and in the context of being basically confirmed, they successfully stopped the market from falling. In this post, Trump rarely specified the currency, and proposed that SOL, ADA, XRP and other altcoins would be included, but it is quite interesting that at the beginning of the post, Trump did not even mention BTC and ETH, which made ETH holders very angry, but then he posted again to add, "Obviously, Bitcoin and Ethereum will become the core of the currency reserve." This move has a significant boost to the market. After the news was released, BTC quickly rose from $85,000 to $95,000, with a maximum increase of more than 10%, now at $92,000. ETH also rebounded to $2,550, and the total market value of cryptocurrencies rebounded by 9% to $3.254 trillion. The reserve currencies clearly pointed out by Trump were even more amazing. ADA rose by more than 70% in 24 hours, with a market value of more than $40 billion, ranking 8th among cryptocurrencies. XRP once reached $2.99, surpassing ETH in terms of fully diluted value, and SOL also stepped out of the shadow of large-scale unlocking and MEME and returned to above $170.

In response, Joseph Lubin, founder of Consensys and co-founder of Ethereum, praised Trump's "calling" behavior on social media, saying "This is an epic call, President Trump is a responsive and confident leader, thank him."

Behind the call, there are also many doubts about insider trading. For example, on the eve of Trump's announcement, there was a whale who was long BTC and ETH with 50 times leverage in Hyperliquid, using about $4 million in funds to leverage a total position of about $200 million. At that time, the prices of Bitcoin and Ethereum were around $85,000 and $2,210, respectively. At present, the address has closed all positions, and in less than 24 hours, it has made a profit of nearly $7 million. Calculated based on the initial funds of $4 million, the yield is 175%.

The insider information may be untrue, but this statement is not groundless. After all, before this, Trump had never mentioned that other currencies besides BTC and ETH would be included in the reserves, but this time he took the lead in publishing a list of altcoins, and put the mainstream reserve currencies at the end, which was obviously putting the cart before the horse. Looking at the three new currencies SOL, ADA, and XRP that have entered the reserves, they are all currencies that have been lobbied by capital, and they are obviously suspected of being "advertising positions", and the transfer of interests is not groundless. SOL is backed by Western capital, while Ripple wins in terms of experience. It bet on both sides before running for election, donating $45 million to the crypto political action committee Fairshake, and immediately showed its loyalty to Trump after his election, donating $5 million in XRP at Trump's inauguration ceremony, and donating another $25 million to Fairshake before the US midterm elections, and has a close relationship with Trump. The entry of ADA is surprising. This currency originated from Cardano and was not taken seriously by Trump before. However, according to CryptoDoggyCN, in early February, the founder of ADA said that he would go to Florida to meet with big shots. Alex Xu, research partner of Mint Ventures, also analyzed that SOL, XRP, and ADA have been running to Mar-a-Lago very frequently since Trump took office.

On the other hand, the president's "choice of heart" is really very casual, and there is even suspicion of ignoring regulations. SOL was previously declared a security by the SEC, and its attributes are not clear now. Therefore, the approval of ETF is not as fast as that of LTC, and Ripple is not much behind. The lawsuit with the SEC has been dragged on for nearly 5 years and has not yet ended. There is no trace of ADA's entry. If it is not for the transfer of interests, it can only prove that it was chosen at random among the top 9 currencies by market value. After all, the president is not a "well-informed" person in the field of encryption.

It can be seen that this call has more or less lobbying elements, and the president's top advertising space is likely to be given to the currency with the most lobbying benefits. In this regard, many industry insiders have also expressed strong dissatisfaction, believing that the president's move not only weakens the legitimacy of the strategic reserve, but is also irresponsible to taxpayers and currency holders. AngelList co-founder Naval Ravikant said frankly, "American taxpayers should not be the ones to take over those nominally decentralized cryptocurrencies," and Aave founder Stani Kulechov also spoke sharply, saying that the addition of XRP, SOL and ADA is ugly news.

Satire aside, the promotion of strategic reserves seems to be far from enough with just the president's verbal check.

The core question is, where does the money come from? For now, there are existing reserves of Bitcoin in the United States, but if you want to establish a crypto reserve, especially a crypto reserve containing other currencies, you can't avoid the issue of fund purchase. According to the latest data from the Congressional Budget Office (CBO), the US federal budget deficit will reach 1.865 trillion US dollars in fiscal year 2025, accounting for 6.2% of the gross domestic product (GDP). The huge deficit has prompted Trump to make several strange moves, either imposing tariffs or shutting down the government internally. He even announced a new plan to buy an immigration gold card for $5 million. All these measures directly reveal the problem that the landlord really has no surplus food.

Against this background, Trump, who is obsessed with money, is implementing all current policies in a "getting something for nothing" mode, whether it is for the government or for himself. Whether it is various tosses in the field of encryption or building a virtual world, traffic monetization is Trump's ultimate goal. It is absolutely impossible for him to invest real money in encryption reserves or pull the market. It is more likely that encryption companies will offer it first, and then keep the reserves and withdraw funds from it.

BitMEX co-founder Arthur Hayes bluntly stated that this move is nothing new, saying "Please tell me when they get approval from Congress to borrow or raise the price of gold again. Without these, they have no money to buy Bitcoin and altcoins. "Some industry insiders also said that Trump frequently used "reserve" and "stockpile" interchangeably in policy terms, and the specific implementation method is difficult to determine. From a practical perspective, if the strategic reserve at the federal level is to be passed, it must be approved by Congress, not decided by the president alone. Although the president won both houses, it was not an overwhelming advantage, especially in the House of Representatives, where he won by only 5 votes. The game between the two parties is far from over, but has become increasingly fierce, and the government shutdown has caused a sensation. On the other hand, the increase in the reserve composition of many currencies will inevitably increase the difficulty of approval. After all, it is obviously unrealistic to use a currency that is already involved in a lawsuit as a strategic reserve, and the road to congressional approval is foreseeable to be difficult. It is worth mentioning that in the past week, the US SEC withdrew the lawsuit against Coinbase and terminated the investigation into projects such as Robinhood Crypto, OpenSea, Uniswap Labs, and Tron, but has not yet ended the lawsuit against Ripple. If you want to bypass Congress, you can only start with the national sovereign fund, but the national sovereign fund did not mention crypto assets before. At the same time, to join the fund, Trump, a businessman president who focuses on interests, must hand in more political donations, which is naturally a heavy burden for crypto companies. Perhaps this is the case. Under such a good news, although Bitcoin and Ethereum have risen rapidly, they have not broken through new highs and are only hovering on the average line.

However, whether it is the transfer of interests or the timing of shouting orders, in the final analysis, Trump's remarks have once again revived the market, which is also a sweet rain in the long drought for the currency circle that is hovering on the boundary between bulls and bears.

On March 7, Trump will hold the first White House Cryptocurrency Summit and deliver a speech. The summit will be hosted by David Sachs, the White House's head of encryption, and managed by Bo Heins, the executive director of the working group. Will Trump bring surprises or shocks to the industry at this summit? The nose of the market is ultimately led by Trump.