A weekend sell-off had pushed Bitcoin and the broader crypto market into a correction, with traders bracing for further downside.
But everything changed when Donald Trump dropped a bombshell announcement, the current U.S. president revealed plans to establish a national crypto reserve, which immediately reignited bullish sentiment.
Initially, he stated that XRP, Solana (SOL), and Cardano (ADA) would be included, triggering a price surge. Hours later, Trump clarified that Bitcoin (BTC) and Ethereum (ETH) would also be part of the reserve, further solidifying crypto’s role in U.S. financial strategy.
A Shift in U.S. Crypto Policy? Trump’s Plan Explained
Trump’s initial announcement outlined plans for a U.S. Crypto Strategic Reserve, a first-of-its-kind initiative that would integrate digital assets into the country’s financial holdings.
He positioned this move as a necessary step to counteract restrictive policies from the previous administration, which he argued had stifled innovation and economic growth in the crypto industry.
At first, Trump named XRP, Solana, and Cardano as the reserve’s initial assets, prompting a swift and dramatic response from the market.
XRP, in particular, saw its fully diluted market cap briefly surpass Ethereum, while Cardano’s total market value increased by $17 billion, nearly doubling in price within hours.
Solana, already gaining traction due to CME Group’s announcement of SOL futures, saw an even greater influx of interest.
The market had barely finished digesting this game-changing revelation when Trump followed up with another statement, this time confirming that Bitcoin and Ethereum would also be included in the reserve.
This second announcement added further momentum, sending BTC and ETH higher and reinforcing the idea that crypto would play a long-term role in U.S. financial policy.
While no concrete details have been provided on how the reserve will operate, the implications of this policy shift are profound. A U.S.-backed crypto reserve suggests:
- A shift away from anti-crypto regulatory enforcement in favour of state-level adoption.
- A potential restructuring of financial policy, as digital assets become an integral part of the U.S. economic system.
- Greater legitimacy for crypto, especially in the eyes of institutional investors who have been hesitant due to regulatory uncertainty.
This dramatic shift in political stance comes at a time when crypto adoption is accelerating globally.
Countries like El Salvador have already embraced Bitcoin as legal tender, while Hong Kong and the UAE are developing pro-crypto frameworks.
With this new policy direction, the U.S. could be positioning itself as a leader in digital asset adoption, something that seemed unthinkable just a year ago.
However, there are still many unanswered questions. Will the government directly purchase and hold these assets?
Will this reserve be a hedge against inflation, or does it have a broader economic purpose? Until these details are clarified, much of the excitement remains speculative, but the shift in sentiment is undeniable.
Retail FOMO or Institutional Play: Who’s Driving the Rally?
The immediate impact of Trump’s announcement has been a surge in retail trading activity, with individual investors rushing to accumulate assets included in the reserve.
On-chain data indicates that retail whales accumulation has intensified, but so far, institutional investors remain cautious.
The lack of direct institutional participation suggests that while the market is reacting positively, bigger players are still waiting for further policy clarity before committing significant capital.
Unlike previous Bitcoin rallies driven by large-scale institutional buying, this one appears fuelled by retail traders and existing crypto holders responding to the political news cycle.
However, the potential for institutional entry remains high, especially if this policy shift translates into tangible regulatory reform. Historically, U.S. regulatory uncertainty has been one of the biggest barriers to institutional adoption of crypto.
If this reserve plan leads to a more structured and transparent approach to crypto regulation, then the doors could open for major Wall Street firms to engage more aggressively in the sector.
That said, there are still risks. While the market is celebrating this shift, political rhetoric doesn’t always translate into concrete policy action.
Trump has previously expressed scepticism towards crypto, and while this announcement marks a dramatic reversal, it remains to be seen whether this is a long-term commitment or a short-term political play.
Moreover, the crypto market is highly reactive to political events, and while this news has sparked a rally, a lack of follow-through could quickly lead to a correction.
Investors will be watching closely for further announcements on how the reserve will be structured and whether legislation will follow to support its implementation.
Conclusion
Trump’s unexpected embrace of crypto has sent shockwaves through the market, with Bitcoin surging 10% in just hours and other named assets experiencing even greater gains.
The Crypto Strategic Reserve, which initially included XRP, Solana, and Cardano, was later expanded to include Bitcoin and Ethereum, further solidifying the policy shift.
While this move signals a potential transformation in U.S. crypto policy, much remains uncertain. Institutional investors are waiting for more clarity, and the market’s next steps will depend on whether this announcement is backed by real policy execution.
If this reserve materialises, it could reshape the regulatory landscape and bring crypto closer to mainstream financial integration. However, if it remains just political rhetoric, the market could soon retrace its gains.