Crypto Industry’s Not Buying into Trump’s Reserve Plans
US President Donald Trump triggered a rally with a surprise announcement even when the Wall Street was sleeping on a Sunday morning. Major crypto currencies registered double digit growth. In fact, XRP flipped the giant - Ethereum - in terms of fully diluted value.
Yet many industry players didn’t buy into Trump’s crypto narrative.
Trump's announcement of the US Crypto Strategic Reserve helped Bitcoin find its footing above $90,000-mark again. Other coins including XRP and Cardano that found a mention in his announcement registered even bigger gains.
The Missing Case of BTC
Trump’s initial post on Truth Social focused on XRP, Solana, and Cardano, without mentioning the top two cryptocurrencies.
Silence was deafening for the Bitcoin enthusiasts who had been anticipating a Bitcoin reserve for months. It stirred a controversy before Trump added them in a follow-up post.
The market celebrated. Bitcoin shot up.
Still didn’t satisfy everyone.
Those of the view that Bitcoin was the only asset fit to be included as part of its strategic reserve raised questions. Difficult ones.
Claims of Favouritism
The inclusion of XRP particularly became contentious due to Ripple's ongoing legal battle with the SEC that is likely to be knocked off under Trump’s administration. Critics also pointed to the "ETH Gate" controversy, where a former SEC official allegedly gave Ethereum preferential regulatory treatment.
Many saw Trump's inclusion of XRP as a political statement against the previous administration's regulatory approach, rather than a decision based on technical merits. Some even called it a result of Ripple CEO Brad Garlinghouse’s recent moves in the power corridors of Washington DC.
Ki Young Ju, CEO of CryptoQuant, said it bluntly: "Trump mentioned XRP, SOL, and ADA first, then brought up BTC and ETH two hours later. Can I interpret his tweets this way? 'BTC and ETH, show me your strategic value—for me and the USA. I just closed a deal with XRP, SOL, and ADA.'"
Why Bitcoin Stands Out for a Strategic Reserve
Fixed Supply Cap: Bitcoin's 21 million coin limit creates natural scarcity, unlike many altcoins with variable supplies.
Established Track Record: Bitcoin has the longest history of security, network stability and global adoption.
Deeper Liquidity: Offers better market depth via Spot ETFs and ETF Options, reducing volatility during large trades.
Decentralisation: No single entity controls the network or can manipulate its supply.
Regulatory Clarity: More established regulatory framework compared to newer altcoins.
Some also see it as an inflationary hedge.
Coinbase CEO Brian Armstrong said, "Just Bitcoin would probably be the best option—simplest, and clear story as successor to gold."
Bitwise CEO Hunter Horsley seconded: "Many crypto assets have merits, but what we're talking about here isn't a US investment portfolio—we're talking about a reserve, and Bitcoin is the undisputed store of value for the digital age."
Why Altcoins Face Scrutiny
Many altcoins have concentrated ownership or more centralised governance. Take XRP for instance. Large portion of its supply is still controlled by its founding company - Ripple.
"The US government using taxpayer money to buy XRP — an asset where Ripple controls over 50% of the circulating supply—is pure insanity,” said Will Baxter, Executive VP at Braiins Mining.
Not everyone shares the scepticism, though.
Binance founder Changpeng Zhao said in a post on X: "Chill guys. No need to overanalyse. More 'valuable crypto' are likely to be added over time. More countries will follow. It's a fantastic start of something really good."
Ripple CEO Brad Garlinghouse pushed back against Bitcoin maximalists: "[I] appreciate the crypto President Donald Trump's vision of a government digital asset reserve representative of the industry. Maximalism is the enemy of the industry's progress."
Trump's crypto reserve announcement has created a stark divide. While signalling mainstream acceptance of digital assets, serious questions remain about implementation, asset selection criteria, and regulatory framework.
The challenging part would be for Trump to get a congressional approval to take this plan forward. BitMEX co-founder Arthur Hayes raises this point accurately.
"Nothing new here. Just words. Lmk when they get congressional approval to borrow money and or revalue the gold price higher. Without that, they have no money to buy Bitcoin and shitcoins."