United States President Donald Trump’s confirmation of a Crypto Strategic Reserve sent shockwaves through the digital asset industry, triggering a short-lived rally before a dramatic reversal. The decision to include Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Cardano (ADA), and Solana (SOL) in the government’s balance sheet has fueled heated debates among industry leaders and market participants.
The announcement led to an immediate market frenzy, with BTC soaring 12%, SOL jumping 26%, and ADA surging a staggering 79% within just eight hours. But the excitement didn’t last. As Wall Street reopened on March 3, the crypto market erased its gains, shedding even more value than it initially added. Total market capitalization surged by $300 billion, only to plummet by $350 billion within 24 hours.
A Divisive Selection: Bitcoin Loyalists Push Back
Trump’s decision to incorporate XRP, ADA, and SOL alongside BTC and ETH sparked strong reactions from major players in the industry. Some hailed it as a groundbreaking move for crypto adoption, while others, particularly Bitcoin maximalists, saw it as misguided.
Coinbase CEO Brian Armstrong and Gemini co-founder Tyler Winklevoss were among the most vocal critics. Winklevoss, an outspoken Bitcoin proponent, dismissed the inclusion of other assets, arguing that only BTC qualifies as a legitimate reserve asset.
“I have nothing against XRP, SOL, or ADA, but I do not think they are suitable for a Strategic Reserve. Only one digital asset in the world right now meets the bar, and that digital asset is Bitcoin,” he said.
Meanwhile, on-chain investigator ZachXBT pointed out a potential red flag regarding XRP and ADA.
“One of the better indicators to judge how legitimate a chain is, is by how many native stablecoins they have issued from Circle, Tether, or Paxos. Both ADA and XRP have zero from major stablecoin issuers,” he noted.
Market Chaos: A Rollercoaster of Billions
The announcement triggered an unprecedented market reaction. Within hours, billions of dollars flooded into the crypto space, creating a flash rally that saw Bitcoin break past key resistance levels and altcoins surge. But just as quickly, the market collapsed, leaving traders reeling.
Some of the wild price movements included:
- Bitcoin (BTC): Jumped 12% before giving back all gains.
- Solana (SOL): Spiked 26% before crashing back down.
- Cardano (ADA): The biggest mover, skyrocketing 79% in hours before reversing.
- Total Crypto Market Cap: Grew $300 billion in less than a day, only to erase $350 billion just as fast.
These erratic swings underscore the fragile sentiment in the crypto market and how government involvement can still act as a double-edged sword. Traders who bought into the rally saw their positions liquidated en masse, with over $1.2 billion in leverage wiped out in a matter of hours.
Conflict of Interest? David Sacks at the Center of the Storm
Adding fuel to the controversy, David Sacks, the White House’s newly appointed Crypto and AI Czar, has come under scrutiny. As the architect of the reserve initiative, his past investments in **Solana and Bitwise—both of which have exposure to all five reserve assets—**are raising eyebrows.
Sacks, a former venture capitalist and a key member of the All-In Podcast, played a pivotal role in the reserve’s formation. While he claimed on social media that he had liquidated all his crypto holdings before joining the Trump administration, skepticism remains.
Some industry insiders are calling for transparency regarding his financial interests, with critics questioning whether the selection of Solana, in particular, was influenced by his past investments.
What Happens Next? All Eyes on the White House Crypto Summit
Further details on the structure of the Crypto Strategic Reserve are expected at the White House Crypto Summit on March 7. The event, led by Sacks, is set to bring together regulators, policymakers, and crypto executives to discuss the implications of the reserve.
The key questions that remain unanswered:
- How will the reserve be funded?
- Will the government actively buy and hold these assets?
- What role will this reserve play in U.S. monetary policy?
- Is there a pathway for the inclusion of other assets in the future?
For now, the market is left in a state of uncertainty, with some hopeful that this marks a new chapter for crypto adoption, while others see it as an unnecessary political gamble.
Whatever happens next, one thing is clear: crypto and U.S. government policy are now more intertwined than ever.
