Trump's Crypto Reserve Proposal Sparks Market Surge

President Donald Trump's recent announcement on Truth Social, directing his crypto working group to establish a Crypto Strategic Reserve, has sparked a significant rally in the cryptocurrency market. The proposed reserve would include Bitcoin, Ethereum, XRP, Solana, and Cardano, leading to substantial gains in these cryptocurrencies. Bitcoin initially surged from around $85,000 to nearly $95,000 before stabilizing at approximately $93,000. Cardano and XRP also saw significant gains, rising about 40% and 16%, respectively.

Standard Chartered's Head of Digital Asset Research, Geoff Kendrick, noted the sharp fluctuations and reaffirmed his long-term bullish outlook on Bitcoin. He maintained his $500,000 Bitcoin price target, outlining a timeline where BTC could reach $200,000 by the end of 2025, $300,000 in 2026, $400,000 in 2027, and $500,000 by 2028. Kendrick attributed this forecast to Bitcoin's increasing role as a global investment asset and a hedge against traditional financial risks. He also suggested that Trump's proposal could lead US states to establish their own Bitcoin reserves, potentially matching the federal government's estimated 200,000 BTC holdings.

However, not everyone is convinced of Trump's crypto reserve proposal. Investment bank TD Cowen expressed skepticism about the plan, calling it "uncoordinated" and lacking clarity on funding. The bank's Washington Research Group, led by Jaret Seiberg, noted that Trump's original post did not include Bitcoin or Ethereum, raising concerns about its coherence. Additionally, there was no indication of how the government would finance the acquisition of tokens. TD Cowen also questioned the significance of calling it a "reserve" rather than a "stockpile," suggesting it remains unclear whether the government intends to buy crypto assets or simply hold seized tokens.

Singapore-based QCP Capital suggested that Trump's announcement was politically timed, likely aimed at countering negative market trends and stabilizing his approval ratings. Coinbase CEO Brian Armstrong also criticized the plan, arguing that only Bitcoin should be included. Joe Lonsdale, billionaire co-founder of AI-focused defense contractor Palantir