Cryptocurrency prices jumped after President Donald Trump's surprise announcement he wants the U.S. government to purchase and hold a variety of digital assets in a strategic reserve fund, an announcement that highlights Trump's growing attempts to use volatile cryptocurrency prices as a barometer of his public support.
Trump said on social media Sunday that his administration is working toward creating a "Crypto Strategic Reserve" that will include lesser-known cryptocurrencies XRP, solana, and cardano. He later followed up with another post saying his planned reserve would also include bitcoin and ether, the two most popular cryptocurrencies.
The announcement helped crypto prices rebound, at least temporarily, after recent sell-offs. Bitcoin was trading around $90,000 Monday morning after dipping below $80,000 last week. XRP, solana and cardano saw massive spikes in their prices after Trump's announcement Sunday followed by a more gradual decline through Monday morning.
On the campaign trail, Trump pledged support for a "strategic national bitcoin" stockpile, which would include bitcoin the U.S. government has previously seized in law enforcement actions. Sunday's announcement was the first time he advocated for the government to hold other types of cryptocurrencies.
The White House did not immediately provide additional details, including how much of each type of cryptocurrency Trump wanted the U.S. to hold, and how the government would acquire them, and whether he favored including other types of cryptocurrencies as well.
Eric Trump, the president's son, said the price increases validated the recent advice he's made on social media to stock up on crypto assets. "Hopefully, I made someone's life just a little bit better," he posted on social media.
The president has cast himself as hero to the crypto industry, which he said in his announcement had been the target of "years of corrupt attacks by the Biden administration." The crypto industry felt unfairly targeted by the Biden administration and spent heavily to help Trump win election. The first several weeks of his administration have seen several moves to boost crypto, including ending or pausing high-profile enforcement actions by the Securities and Exchange Commission.
Crypto prices soared after Trump's victory last year, and when the price of bitcoin first crossed $100,000 in early December, Trump took credit and posted "YOU'RE WELCOME!!!" on social media.
But prices have fallen since Trump's inauguration and Trump has faced criticism, including from allies within the crypto industry, for helping launch a personal meme coin just before he took office that has since collapsed in value. The crash of meme coins linked to First Lady Melania Trump and Argentine President Javier Milei, along with a massive hack of a major cryptocurrency exchange that the FBI has said was done by North Korea, have also dimmed enthusiasm for crypto.
"Why is crypto in the toilet if Trump is crypto king?" Dave Portnoy, an influencer and crypto enthusiast, said on social media last week.
The inclusion of cryptocurrencies other than bitcoin is likely to face sustained pushback among some corners of the heavily divided cryptocurrency industry. Bitcoin is the oldest and by far most popular cryptocurrency, and accounts for more than half of the world's global crypto market cap.
Advocates for the government holding a crypto reserve said would help diversify government holdings and hedge against financial risks. Critics say the volatility of cryptocurrencies makes them a poor choice as a reserve asset.
In addition to his announcement Sunday, Trump has also recently announced he will speak at and host industry leaders on Friday at a White House "Crypto Summit."
