The crypto markets started the week with high expectations but were soon met with uncertainty after U.S. President Donald Trump’s proposal for a national strategic crypto reserve. Bitcoin initially surged following Trump’s announcement but later retreated as traders sought more details about the plan.
Trump’s Crypto Reserve Plan Sparks Volatility
Over the weekend, Trump posted on Truth Social, revealing that his administration’s digital asset strategy would involve a national stockpile of cryptocurrencies. This announcement temporarily boosted Bitcoin, pushing it up 2.4% from Friday to $86,292. However, the momentum faded quickly, with Bitcoin losing 8% from Sunday’s high.
Trump’s post confirmed that Bitcoin and Ethereum would be at the core of this reserve, along with other major altcoins such as XRP, Solana, and Cardano. While this news initially excited the market, concerns over funding sources and policy clarity led to a pullback.
Ethereum dropped 4.3% from Friday’s levels, settling at $2,127.10, but suffered a more significant 16% decline from its Sunday high. XRP tumbled over 15% from Sunday but remained 25% above Friday’s close. Solana and Cardano also weakened, down 16% and 19% from Sunday, respectively.
Mixed Reactions from Crypto Leaders
Not everyone in the crypto space welcomed Trump’s plan. Investor Anthony Pompliano criticized the initiative, calling it an “unforced error” that could ultimately harm taxpayers. He expressed concerns that the reserve might benefit insiders and token creators rather than the broader market.
Cameron and Tyler Winklevoss, co-founders of the Gemini exchange, also weighed in, questioning the inclusion of multiple altcoins. They argued that Bitcoin is the only cryptocurrency that meets the standards of a true reserve asset.
A New Era for Crypto or More Uncertainty?
Bitcoin’s struggles in February highlight the industry’s volatility. The leading cryptocurrency saw a 17% decline last month, marking its steepest drop since June 2022. After briefly topping $105,000 in early January, Bitcoin has lost more than a third of its value.
Despite Trump’s crypto-friendly stance, investors remain cautious. Analysts warn that without a clear funding source—whether taxpayer money or seized crypto assets—the proposed reserve may not be the bullish catalyst many had hoped for.
What’s Next for Bitcoin and the Market?
For now, Bitcoin’s next major target remains the $100,000 mark, but it faces headwinds from both market uncertainty and regulatory ambiguity. Will Trump’s administration deliver on its pro-crypto promises, or will the market continue to see hesitation?
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