Donald Trump, the president of the United States, shocked markets on Sunday. Assets intended for an upcoming U.S. crypto-strategic reserve.
Analysts at investment firm Bernstein are puzzled by U.S. President Donald Trump's announcement that he would include Ethereum, The XRP currency is a cryptocurrency that can be used to buy and sell goods., SolanaThen, Cardano The U.S. Federal Reserve Bank, in an article published on Monday, warned against the creation of a national cryptocurrency reserve if it involved the U.S. government.
"The position of Bitcoin as a 'digital gold' holding for the U.S. government was expected," In a report published on Monday, analysts Gautamchhugani and Mahika Sapra wrote.
"ETH and SOL are the two most-used blockchain networks, and holding their native assets supports the growth of the industry—but the rationale for a sovereign to hold it in reserve is unclear," They noted.
Trump revealed a crypto-reserve in a post posted on Truth Social Sunday. "elevate this critical industry after years of corrupt attacks by the Biden administration." He was eager to keep his campaign promises, which included calling for a cryptocurrency reserve.
Bernstein analysts also said it was not clear if the concept of a cryptocurrency reserve would be pushed forward with an executive directive alone. They added that it would be hard to convince other government members to hold altcoins such as Solana or Ethereum.
"We think a realistic path could be that the U.S. government can convince the Congress that Bitcoin is the new digital gold/global store of value and a gold revaluation/gold reserve reallocation makes sense," The report stated. "However, buying other blockchain assets from Fed funds or treasury funds is a difficult sell."
He stated that cryptocurrency like Ethereum (the second largest digital coin in terms of market capital) and Solana (6th biggest), would be owned by the government.
During his campaign the president focused heavily on Bitcoin to build a national cryptocurrency stockpile. Many industry observers were surprised by his plans to include alternative coins.
Bitcoin jumped sharply after Trump's post and nearly touched $95,000 on Sunday, but lost those gains in Monday trading, dipping nearly as low as $85,000 in the afternoon.
The crypto market has been on a downtrend in the last few weeks due to concerns over inflation, potential trade conflicts based on Trump tariffs, as well as other macroeconomic uncertainties. Bitcoin has fallen from its highs of over $108,000 in January.
James Rubin is the editor