Trump’s Crypto Reserve Plan Reshapes Market as Bitcoin Dominance Falls Below 50%
The cryptocurrency market experienced a seismic shift following U.S. President Donald Trump’s announcement of a national Crypto Strategic Reserve.
Initially, Trump revealed that the reserve would include XRP, Solana, and Cardano—three prominent altcoins. However, in a subsequent post on Truth Social, he confirmed that Bitcoin (BTC) and Ethereum (ETH) would be “at the heart of the reserve,” reinforcing their dominance in the digital asset landscape.
The move sent waves through the market, leading to a notable decline in Bitcoin dominance. BTC’s share of the total crypto market fell from 55.4% to below 50% within hours, settling at 49.6% as investors flocked to alternative cryptocurrencies.
XRP and Cardano surged by 34.7% and 60.3%, respectively, while Solana and Ethereum posted gains of 25.5% and 13.1%. Bitcoin, in contrast, saw a modest 10% increase, reaching $94,220.
Mixed Reactions from the Crypto Community
The inclusion of altcoins in the reserve has sparked debate, particularly among Bitcoin maximalists. Peter Schiff, a well-known Bitcoin critic, acknowledged the rationale for a Bitcoin reserve, comparing it to the U.S. gold reserve, but questioned the necessity of including XRP. “I get the rationale for a Bitcoin reserve,” Schiff wrote. “I don’t agree with it, but I get it. But what’s the rationale for an XRP reserve? Why the hell would we need that?”
Others echoed similar concerns. Jeff Park, head of alpha strategies at Bitwise, called the decision a “huge political miscalculation by Trump in underestimating just how crucial it was for the Strategic Reserve to focus solely on Bitcoin.” Nick Neuman, CEO of Bitcoin custody firm Casa, added, “The only crypto asset that makes any logical sense whatsoever as part of a country’s strategic reserve is Bitcoin. Infinite supply digital assets—especially ones with zero utility—do not fit the bill.”
Despite the backlash, some market analysts see the development as a turning point for digital assets. Crypto trader Michaël van de Poppe noted that the market’s reaction signaled “the final easy cycle” for altcoins, with a broader rally ahead. Meanwhile, trading resource The Kobeissi Letter characterized the announcement as “what crypto has been waiting for.”
A Shift in U.S. Crypto Policy
Trump’s stance on cryptocurrency has evolved over time. During his keynote speech at the Bitcoin 2024 conference in Nashville, Tennessee, he pledged that his administration would establish a “strategic national Bitcoin stockpile,” ensuring that the U.S. government would retain 100% of all Bitcoin it currently holds or acquires in the future. However, his recent actions suggest a broader approach to digital asset adoption.
The President’s Working Group on Digital Assets, led by Bo Hines and White House AI and crypto czar David Sacks, has been evaluating the feasibility of a national crypto reserve for weeks. Their recommendations culminated in Trump’s executive order on January 23, which directed the formation of a “digital asset stockpile.” However, the order also banned the development of a central bank digital currency (CBDC), a move that reassured many within the crypto industry who oppose government-controlled digital money.
Bitcoin maximalists remain wary of the broader language in Trump’s policy. Walker, host of THE Bitcoin Podcast, asked on social media, “Raise your hand if you think Donald Trump should make the national ‘digital asset’ stockpile Bitcoin only.” Riot Platforms’ vice president of research, Pierre Rochard, also criticized the executive order for deviating from Trump’s earlier commitment to a Bitcoin-only reserve.
Upcoming White House Crypto Summit
To further clarify his administration’s crypto policy, President Trump will host the first White House Crypto Summit on March 7. The event will bring together industry executives, regulatory officials, and key members of the Digital Asset Working Group to discuss the future of crypto regulation and stablecoin oversight. The summit, chaired by David Sacks and administered by Bo Hines, is expected to provide further insight into the administration’s long-term vision for digital assets.
Market Implications
As crypto markets digest the implications of the strategic reserve, volatility remains high. Bitcoin’s price recently touched $93,000, nearing a crucial resistance level of $93,500. Analysts believe that a sustained close above this level could signal a bullish continuation for BTC. However, with increased investor interest in altcoins, Bitcoin’s dominance may continue to erode in the short term.
With Trump’s evolving stance and the upcoming summit, the future of the U.S. crypto landscape remains uncertain. What is clear, however, is that digital assets are now firmly entrenched in national policy discussions—a development that could shape the industry for years to come.
