Cryptocurrency prices and meme coins continued climbing early Monday after President Donald Trump on Sunday detailed plans for a U.S. strategic reserve. However, the rally was short-lived after President Trump announced tariffs on Mexico and Canada will go ahead. Bitcoin fell back below $87,000 by Monday afternoon. Meanwhile, not everyone is sold on Trump's inclusion of altcoins in the reserve.
President Trump on Sunday outlined via social media plans for a strategic crypto reserve to social media. The reserve is to include Solana's SOL token, Cardano's ADA, as well as XRP, bitcoin and ether, his post said.
"A U.S. Crypto Reserve will elevate this critical industry," Trump wrote on his Truth Social site on Sunday, adding "my Executive Order on Digital Assets directed the Presidential Working Group to move forward on a Crypto Strategic Reserve that includes XRP, SOL, and ADA."
President Trump had issued a crypto executive order on Jan. 23, mentioning a "national digital asset stockpile" but didn't cite any specific cryptocurrencies.
He followed up on Sunday with another post, "obviously, BTC and ETH, as other valuable Cryptocurrencies, will be at the heart of the Reserve. I also love bitcoin and ethereum."
Altcoins In Focus
XRP is the native token for XRP Ledger, an open-source blockchain from crypto firm Ripple. The SEC sued Ripple in 2020 alleging that XRP was a security. In July 2023, a judge ruled that XRP was not a security for retail sales, but was a security for institutional sales. Ripple in 2024 was ordered to pay a $125 million fine, but that was far less than the $2 billion sought by the SEC. The regulator appealed the ruling in October, but a new settlement has not been issued.
Solana is a hybrid proof-of-stake blockchain platform that focuses on Web3 infrastructure and allows users to create non-fungible tokens (NFTs) and decentralized apps (dApps) and games. President Trump launched his Official Trump meme coin on Solana prior to inauguration.
Similar to Solana, the Cardano blockchain allows users to create decentralized finance apps, NFTs, games and other projects.
Bitcoin and ethereum are two blue-chip cryptos that were considered prime candidates for the strategic reserve. But inclusion of SOL, XRP and ADA was a bit of a surprise.
Industry Reactions
"Excited to learn more," Coinbase CEO Brian Armstrong posted online Sunday night. "Still forming an opinion on asset allocation, but my current thinking is 1. Just bitcoin would probably be the best option — simplest, and clear story as successor to gold 2. If folks want more variety, you could do a market cap-weighted index of crypto assets to keep it unbiased. But probably option No. 1 is easiest."
Matthew Sigel, head of digital asset research at VanEck, on Sunday reposted a statement from late January. "Bitcoin is categorically different from all other digital assets," he wrote. "In my opinion, it is the only crypto appropriate for a U.S. Government Stockpile. All others require a portfolio manager."
Others are a bit skeptical about the long-term impact.
"While the crypto reserve announcement was a bullish catalyst for crypto prices in the short term, its long-term impact remains questionable," wrote Nic Puckrin, cofounder of The Coin Bureau. "For one thing, no actual details have been disclosed yet. In addition, the timing of the announcement — on a Sunday evening during a low liquidity period — means we're likely seeing the combination of 'hopium' with a classic short squeeze."
"But this may not be enough to draw investors' attention away from the tariffs coming into force this week, and the general macroeconomic and geopolitical uncertainty dominating market sentiment at the moment," Puckrin continued. "The key question is, how will they fund and legislate this reserve? Until we have some answers, there's little substance to support this rally, and it could fizzle out as quickly as it started."
Other Bitcoin Countries
Other countries have started exploring potential bitcoin reserves or accumulating their own supply. However, others plan to amass the cryptos through government seizures tied to illicit activity, rather than direct purchases as Trump seems to plan.
El Salvador in late January abandoned its plan to use bitcoin as legal tender after the nearly four-year experiment under President Nayib Bukele failed to reach mass adoption and protect against inflation. The country reached a $1.4 billion loan agreement with the International Monetary Fund in exchange for removing bitcoin as legal tender and limiting purchases. El Salvador's bitcoin holdings are worth over $570 million, according to Arkham Intelligence.
The Government of Bhutan's bitcoin holdings are closing in on $1 billion.
China holds about $19.2 billion of the crypto, along with the U.K. and Ukraine at $6.2 billion and $4.7 billion, respectively. Czechia, Germany, Hong Kong, Poland, Russia and Japan are also in the early stages of exploring bitcoin reserves, according to reports.
Trump Crypto Moves
Ahead of the announcement, President Trump's Trump Media & Technology Group filed a trademark application for new metaverse services. According to the Feb. 24 filing, Trump Media requested trademarks regarding NFT products and sales, virtual goods and services, and a blockchain-based inventory management system. The trademark filing describes virtual reality game software featuring crypto tokens and NFTs for use in an online virtual world related to the "45th and 47th President."
Elsewhere, Trump's crypto venture, World Liberty Financial, on Feb. 11 announced a strategic reserve token to "bolster leading projects like bitcoin ethereum, and other cryptocurrencies that are at the forefront of reshaping global finance."
Bitcoin Price, Crypto Moves
Bitcoin rallied as high as $94,834 on Monday from its $85,000 level on Sunday ahead of the reserve announcement. By 4 p.m. ET Monday, it had slipped back near $86,000.
Ethereum peaked at $2,548 on Monday, from its early Sunday level around $2,200. The price of ethereum fell back to $2,138 Monday afternoon.
The price of XRP rallied to $2.95 Monday before sliding back near $2.40.
SOL reversed from its Monday high of $178.63 to trade around $142 in the afternoon.
ADA spiked to $1.13 on Monday before falling back near 86 cents.
Coinbase stock declined 4.6% on Monday, following a 3% advance at the open.
Shares of bitcoin miners including Mara Holdings, CleanSpark and Iren saw sizable reversals.
The iShares Bitcoin Trust and other bitcoin ETFs pared their Monday gains to around 2%.
You can follow Harrison Miller for more stock news and updates on X/Twitter @IBD_Harrison
