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Why did Trump leave Bitcoin and Ethereum out of his crypto reserve at first? And what made him change course an hour later? And what does it mean for Bitcoin’s future as a national strategic asset?
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Trump’s crypto reserve shakes things up
After months of speculation, President Donald Trump has officially announced the formation of a U.S. crypto strategic reserve.
On March 2, he directed the President’s Working Group on Digital Assets to include Ripple (XRP), Solana (SOL), and Cardano (ADA) in the reserve.
The decision was initially met with enthusiasm from supporters of these assets, but the absence of Bitcoin (BTC) and Ethereum (ETH) in the original statement caught many by surprise.
An hour later, Trump clarified in a follow-up post that BTC and ETH would also be included, stating they would be “at the heart of the reserve.”
Senator Cynthia Lummis originally introduced a bill proposing a Bitcoin-focused strategic reserve, calling for the U.S. Treasury to acquire one million BTC over five years — roughly 5% of Bitcoin’s total supply.
During his 2024 campaign, Trump embraced the idea, and shortly after taking office, he signed an executive order directing a working group to assess its feasibility.
His decision to include multiple assets rather than focusing solely on Bitcoin has sparked mixed reactions.
While some Bitcoin advocates argue that BTC alone should be the foundation of a national crypto reserve, others see this as a step toward broader digital asset adoption at the federal level.
What happens next? How will this decision shape U.S. crypto policy? And what ripple effects could it have on the global financial system? Let’s break it down.
Market soars as altcoins surge
The crypto market reacted swiftly to Trump’s announcement, with the overall market cap surging by approximately $230 billion in the last 24 hours as of Mar. 3, rising from $2.81 trillion to $3.04 trillion—an increase of over 8%.
ADA led the rally, opening at $0.65 on Mar. 2 before soaring to $1.13—an impressive 74% jump. Some profit-taking followed, bringing ADA down to $0.96 as of Mar. 3, but the asset remains well above pre-announcement levels.
SOL, which had been struggling in a bearish market, also saw a sharp rally, climbing from $143 to $178 for a 25% gain before settling around $161.
XRP — already one of the biggest winners since Trump’s election—jumped 35%, rising from $2.19 to a high of $2.97 before retracing to $2.68.
Bitcoin, despite being left out of Trump’s initial announcement, posted a strong recovery. It officially broke out of its bearish phase, crossing $90,000 and reaching a high of $95,043 before stabilizing at $92,500, marking a 10% rally.
Ethereum followed a similar pattern, climbing from $2,216 to $2,548 — a 15% gain — before settling at $2,376. ETH saw the largest retracement among the major assets but remained above pre-announcement levels.
While XRP, ADA, and SOL supporters celebrated their inclusion, many Bitcoin advocates saw the initial omission as a snub, especially given Trump’s previous praise of Bitcoin as a national strategic asset.
Crypto lawyer Irina noted the irony of Bitcoiners backing Trump only to see BTC left out of the first announcement.
Meanwhile, crypto analyst The Bitcoin Therapist took a harsher stance, criticizing the inclusion of other coins in reserve and joking that the move was so unexpected that even longtime Bitcoin sceptic Peter Schiff might begin supporting BTC.
Insider trading speculation steams
The controversy surrounding Trump’s crypto reserve announcement erupted almost immediately after the market’s reaction.
Hours before the news broke, well-known trader Teddy Bitcoins posted on X about a $200 million bet on BTC and ETH using 50x leverage.
In simple terms, this meant that instead of needing the full $200 million to enter the trade, the trader only had to put up 2% of that amount as collateral — $4 million. The remaining $196 million was borrowed from the exchange, amplifying both potential gains and risks.
With this level of leverage, even a 2% price drop could have liquidated the entire position, wiping out the trader’s initial $4 million.
However, instead of dropping, BTC and ETH surged following Trump’s announcement, making the highly leveraged position potentially very profitable.
After the announcement, Teddy Bitcoins returned to X with a pointed question: “If Bitcoin has no insider trading, explain this.”
His comment sparked suspicions across the crypto community. Investor Mike Alfred took the speculation further, directly linking the trade to Trump and his inner circle, sarcastically praising them for turning political power into financial gain.
But the scrutiny didn’t stop there. Another layer of controversy emerged when journalist Ben Norton pointed out that Trump’s recently appointed AI and crypto czar, David Sacks, had indirect financial ties to the very assets included in the U.S. crypto reserve.
Norton claimed that Sacks was linked to a fund where the top five holdings matched the five cryptocurrencies selected for the reserve.
Sacks quickly responded to questions about his involvement, stating that he had sold all of his personal crypto holdings, including Bitcoin, Ethereum, and Solana, before taking office.
However, reports suggest that his investment firm, Craft Ventures, still holds stakes in multiple crypto-related companies, including Bitwise, BitGo, Lightning Labs, and Dune.
One of these companies, Bitwise Asset Management, has exposure to the same cryptocurrencies now included in the U.S. reserve.
There is no concrete proof linking the high-risk trade to Trump’s team, nor any confirmed evidence that Sacks influenced the selection of the reserve’s assets.
But the sequence of events — the perfectly timed $200 million position, the rapid price surge, and the crypto czar’s financial connections — has left many with more questions than answers.
With crypto now being taken seriously at the highest levels of government, the pressure for transparency is only going to increase. And if regulators decide to investigate, this may not be the last time these concerns resurface.
What do experts think?
The reactions to Trump’s crypto strategic reserve announcement have been all over the place. Some see it as a major step toward legitimizing digital assets at a national level, while others think it’s a political miscalculation that could create unnecessary complications.
One of the strongest arguments against the multi-asset reserve is that Bitcoin, as the most established and decentralized cryptocurrency, should have been the sole choice. Coinbase CEO Brian Armstrong supported this view, calling Bitcoin the “simplest” and most logical successor to gold.
He acknowledged that a market cap-weighted approach could help maintain neutrality if broader exposure was desired. However, he still leaned toward a Bitcoin-only strategy as the “easiest” and most defensible option.
Armstrong’s argument was echoed by Jeff Park, Head of Alpha Strategies at Bitwise, who criticized Trump’s decision as a “huge political miscalculation” for underestimating the importance of focusing solely on Bitcoin.
Park warned that including altcoins with uncertain long-term value in the national reserve introduces unnecessary risks, both financially and politically.
“When you include altcoins whose use case is too nascent to be deemed ‘nationally strategic,’ you risk the assumption of insider dealing — even if it were patently false,” he said.
Beyond the optics, some experts see fundamental issues with certain assets in the reserve.
Will Baxter, Executive Vice President at Braiins Mining, questioned the logic of the U.S. government using taxpayer money to acquire XRP, an asset where Ripple still controls more than half of the circulating supply.
Baxter’s concern is that a government-backed purchase of XRP could further centralize control in Ripple’s hands — an entity already facing regulatory scrutiny in the U.S.
Then there’s the question of whether this reserve will actually come to fruition.
Former BitMEX CEO Arthur Hayes dismissed the announcement as mere talk, pointing out that without congressional approval to allocate funding or a broader financial strategy — such as revaluing the gold price — there is no mechanism in place to acquire these assets.
Hayes’ scepticism is rooted in historical precedent. While executive orders and working groups can lay the groundwork for policy, actual execution often requires broader legislative approval, especially when it involves financial allocations at the national level.
Despite that, Binance co-founder CZ took a more relaxed approach, suggesting that the reserve will evolve over time.
He implied that more assets would likely be added, and other governments might follow suit, signalling a shift in how nations engage with digital assets. “No need to overanalyze,” he commented, reassuring market participants that this is just the beginning.
If the U.S. government is serious about building a digital asset stockpile, it will need to address these concerns, provide transparency, and ensure that its strategy is based on long-term stability rather than short-term market speculation. While the announcement may be a first step, the real test lies in what happens next.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
This article first appeared at crypto.news
