President Donald Trump’s new statement about the Trump Crypto Reserve including XRP, Solana (SOL), and Cardano (ADA) has triggered a tidal wave of conversation, speculation, and debate. Many have noted his omission of bitcoin, which was corrected by a follow-up post a few minutes later that stated bitcoin (and ethereum) would also be included.
Bitcoin stands apart from all other digital assets by virtue of its liquidity, security, and genuine decentralization. The initial omission is unusual, to say the least, and on its face might sound alarming to those of us who believe that bitcoin—not the broader “crypto” market—represents the future of sound money. But in the broader context of his prior public statements and policy pledges, Trump has not abandoned the world’s most secure decentralized network, and has explicitly stated in the past that any U.S. digital asset stockpile would also include bitcoin.
Today’s posts also raise concerns about the competence of the President’s crypto policy advisors. Trump’s Crypto Czar, David Sacks, and Executive Director Bo Hines have displayed limited expertise, if not outright confusion, when it comes to digital asset technology. One need only glance at Trump’s ill-timed meme coin launch of both $TRUMP and $MELANIA coins before the inauguration.
There is now a clear mismatch between the rhetorical flourish of the White House and the reality on the ground. Sacks’s continued oversight of “crypto” policy leaves the door open for mistakes that can slow progress for bitcoin and potentially mislead consumers. In fact, the fiascos and scams that have plagued the broader digital asset market have harmed the public perception of bitcoin. In short, there is a real risk that the new White House push toward “crypto” could bury the far more relevant bitcoin narrative.
The Promise and the Problem
The promise of a national digital asset reserve, even if it includes tokens that lack bitcoin’s fundamental advantages, isn’t entirely misplaced. One could argue that familiarizing retail investors, institutions, and policymakers with the very idea of buying and holding digital assets lowers the friction to ultimate bitcoin adoption. That friction remains a huge factor in the U.S., where some politicians still reflexively treat “cryptocurrency” as a monolith. Yet we have already seen positive outcomes when governments adopt a thoughtful approach, as evident in Texas, where the State House continues to weigh the creation of its own Strategic Bitcoin Reserve. Eventually, policymakers will realize that bitcoin’s liquidity dwarfs nearly everything else in digital assets, and a robust state-level treasury with bitcoin on the balance sheet could become a key driver of economic resilience.
Trump’s proposal, by contrast, demonstrates a profound lack of discernment. By including relatively illiquid tokens with market caps significantly smaller than bitcoin’s, Sacks’s working group invites a host of new problems. Just last week, bitcoin’s daily trading volume measured in tens of billions of dollars. Meanwhile, XRP, SOL, and ADA are the purview of hobbyist crypto traders who can trigger outsized price movements and liquidity crunches with relatively small trades. The Solana network has periodic shutdowns, and XRP is controlled by a cabal of insiders.
The political fallout from the failure of one of these crypto projects would be unfortunate, both for the Trump administration and the American people who could otherwise benefit from the financial freedom that bitcoin enables. If one or more of these tokens collapses after the White House anchors some portion of the U.S. reserve in them, Trump and his allies could face headlines about “flawed crypto picks” or even worse—the kind of embarrassing fiasco that plagued other administrations when misguided economic policies backfired.
In the broader digital asset industry, we have seen how token collapses can lead to immediate regulatory crackdowns, criminal charges, and the general public souring on blockchain-based assets. The Terra meltdown in 2022 sent shockwaves around the globe, and the FTX scandal continues to reverberate through Washington’s halls of power. Every time such a collapse occurs, politicians run for cover, new regulations are hastily introduced, and genuine technological breakthroughs risk getting drowned in the noise.
Therein lies the bigger problem: confusion in the marketplace. When a sitting president implies that all “digital assets” share comparable utility…
Read More: What Does It Mean For Bitcoin?