Cryptocurrencies surged Sunday after the White House announced plans for a crypto summit while disclosing the assets that would make up a potential U.S. crypto strategic reserve. Those are bitcoin, ether, XRP, solana and cardano.
Those gains were given back on Monday. But it’s clear that should the crypto strategic reserve come to life, it will focus on the space’s biggest constituents. Bitcoin, ether, and XRP are the three largest digital currencies by market capitalization. Solana and cardano rank sixth and eighth, respectively, by that metric.
In what could be a catalyst for spot bitcoin ETFs like the Coinshares Valkyrie Bitcoin Fund (BRRR ), bitcoin is expected to be the focal point of the reserve. That’s not surprising when considering its dominance in the cryptocurrency realm. As of late Wednesday, bitcoin sported a market value of $1.79 trillion. That’s well ahead of ether’s market cap of $270 billion.
Bitcoin Could Get VIP Status
Trump frequently mentioned the possibility of a bitcoin strategic reserve on the 2024 campaign trail. That was a reason some crypto supporters backed him. To that end, it’s understandable that bitcoin and ETFs such as BRRR retreated on Monday as market participants assessed the places of other digital currencies in the proposed strategic reserve.
The inclusion of cardano, ether, solana, and XRP in the reserve is viewed by some as diluting bitcoin’s effect. Commerce Secretary Howard Lutnick sought to allay those concerns with recent comments indicating bitcoin will be the VIP in the strategic reserve. He said the other components will receive different though still positive treatment. But bitcoin will be the focal point.
“A Bitcoin strategic reserve is something the President’s interested in. He spoke about it all during the campaign trail, and I think you’re going to see it executed on Friday,” Lutnick said in an interview with The Pavlovic Today. “So Bitcoin is one [thing. And] then the other currencies, the other crypto [tokens … will] be treated differently—positively, but differently.”
Those comments were made Tuesday night in advance of the March 7 crypto summit at the White House. BRRR responded with a gain of 4.28% on Wednesday. That was accrued on volume that was more than double the daily average.
For his part, Trump said in a recent post on Truth Social, that bitcoin and ether “will be at the heart of the Reserve.” He said he loves those two digital currencies.
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