Bitcoin and Crypto Stocks Jump 10% on Trump's Reserve Plan
1min read Bitcoin surged over 10% from last week's low on Monday, with other cryptocurrencies and crypto-related stocks such as Strategy also posting strong gains. The rally followed a statement from U.S. President Donald Trump, who hinted at the creation of a new U.S. strategic reserve that would include a variety of digital assets.
In a post on Truth Social, Trump revealed that his January executive order on digital assets would facilitate the stockpiling of multiple cryptocurrencies, including Bitcoin, Ethereum, XRP, Solana, and Cardano. Bitcoin and Ethereum would serve as the core assets in this reserve.
Cryptocurrencies faced a sharp selloff last week, as investors dumped major tech stocks like those in the Magnificent 7, dampening market confidence in Bitcoin. Some traders view Bitcoin as a proxy for tech stocks, meaning its price often moves in tandem with the broader technology sector.
How Do Analysts View It?
Trump just gave the pump that crypto traders had been waiting for, said Matt Simpson, senior market analyst at City Index.Any faith that was lost last week appears to have been restored, he added, suggesting that new all-time highs could be reached unless another wave of risk-off sentiment hits the market.
Chris Weston, head of research at Pepperstone, noted that the rally might extend into Trump's first White House Crypto Summit, scheduled for Friday. However, he cautioned that broader market bearishness could still weigh on sentiment.
While Trump's announcement has significantly boosted prices, it has also raised concerns, according to IG market analyst Tony Sycamore.
He pointed out that funding for the U.S. crypto reserve could come from two possible sources: U.S. taxpayers' money, which could spark political and financial debates; Cryptocurrencies seized in law enforcement actions, which would not be as bullish since it represents a mere transfer of assets between accounts rather than new buying entering the market.