As new developments and rumors abound with cryptocurrency growing in the American political and economic climate, this stands to shift a lot come March 2, 2025, when newly inaugurated President Donald Trump creates a U.S. Crypto Reserve one week into his presidency. His revolutionary decision makes cryptocurrency no longer a speculative asset.
Background and Context
Trump wasn’t always on board with crypto. He once called Bitcoin a “scam” in 2021. It was in a bid to protect the American citizen from an uncertain investment that could cause more harm than good, but also, could compete with the US dollar.
In 2025, he supports it, and so does most of the Republican Party after a big tent red state turn. Where the GOP members looked non-crypto friendly over the past few years. Now a considerable amount of GOP leadership thinks that digital assets are uniquely American pursuits that foster innovation and capitalism.
Where other leaders stood on a national level, with the Biden administration, it was about regulation to protect the unwitting consumer and any nefarious conclusions they thought could come from widespread crypto usage. Trump wants to make crypto an asset to the American citizenry instead of something to quash out of fear of illegal intentions. Once again, it’s all about positioning and what’s best for the public good.
Details of the US Crypto Reserve Proposal
What assets will comprise the U.S. Crypto Reserve? The assets are Bitcoin, Ethereum, XRP, Solana, and Cardano as these cryptocurrencies have been reserved to be put into the government reserve.
How will it help the economy? It’s a method to increase economic stabilization, cryptocurrency can become a hedge against inflation and a new store of value. Who will manage implementation?
The Treasury Department will be responsible for management under the new Presidential Working Group on Digital Asset Markets to be established by the January 10, 2025 Executive Order.
The Working Group will consist of members from the Treasury Department, the Fed, and the SEC, with reserve intentions subject to larger policies and regulations. When will it take place? In stages, from current cryptocurrencies already locked away from law enforcement action to potentially acquired—this will all be determined at the White House Crypto Summit on March 7, 2025.
IV. Economic Implications
This reserve can alter projections tremendously. On a domestic level, it adjusts the dollar pegged system as decentralized assets can minimize reliance on Federal Reserve fiat policies, when the news broke, Bitcoin was up 9% to $93,000 and Ethereum hovers at $2,500, a good sign from within the market.
On a global level, it makes the United States a leader in cryptocurrency, even more so after China pushes for a digital RMB. I predict inflationary pressures or how crypto is assessed on Wall Street as government holdings complicate the valuation assessment.
For the average American, it means more public policy approaches that favor consumer options or reduced barriers to entry for individual investment. The introduction of a U.S. Crypto Reserve could also have significant implications for forex trading, potentially altering the dynamics of currency exchange rates and international trade.
Regulatory Framework
It’s not going to be easy to add a crypto reserve into America’s regulatory system. Cryptos are under the auspices of the CFTC or SEC, depending on their commodity or security classification.
Should Trump’s reserve be approved, it requires a legislative amendment to create the regulatory framework by which the asset type would be allowed to be held by the government. However, the Presidential Working Group should convene to decide the best course of action, one that fosters innovation without risk to the citizenry.
More set tax implications or trade offerings would do the trick. Whereas El Salvador trades essentially in Bitcoins, the United States just wants a reserve, an option, not to replace the dollar, but another option.
Conclusion
On March 2nd, 2025, Donald Trump signed a proclamation for a U.S. Crypto Reserve, cryptocurrency like Bitcoin, Ethereum, and XRP will now be part of the national economic policy and revenue going forward.
The Department of Treasury will oversee this U.S. Crypto Reserve, which aims to be facilitated by a new Presidential Working Group to stabilize and economically project America in cryptocurrency.
Following the proclamation, Bitcoin skyrocketed to $93,000. This means the markets approve, however, this should be concerning because it means millions of investors are investing in something without knowing what’s going on yet.
Millions of cryptocurrencies exist without governance, meaning that educated guesses must be applied to Bitcoin, etc.
