- Trump’s crypto reserve is likely to be “nearly entirely Bitcoin,” says Bitwise CIO Matt Hougan.
- Some industry leaders are not happy with the inclusion of small-cap cryptocurrencies in US reserves.
Bitwise’s Chief Investment Officer, Matt Hougan, shared his view on Trump’s US crypto reserve. Despite initial plans to include various altcoins, Donald Trump’s proposed cryptocurrency reserve will likely end up being almost exclusively Bitcoin, according to Bitwise CIO Matt Hougan.
Hougan highlights that the market’s initial negative reaction to the inclusion of smaller cryptos misses the bigger picture of what could become a significant government investment in digital assets. He predicts that when everything is finalized, Bitcoin will dominate the US reserve.
Market Confusion Over Reserve Composition
In a March 5 blog post, Hougan stated that including small-cap cryptocurrencies in US reserves unnecessarily complicated matters. On Sunday, March 2, Trump announced that the reserve would include Bitcoin, Ethereum, Solana, XRP, and Cardano.
Initially, the market spiked on the news, with Bitcoin jumping from $85,000 to $95,000. But on the next day, the market started to pare back and ate almost all their announcement gains. This was partly due to Trump delaying auto parts tariffs on Canada and Mexico.
Some industry leaders questioned the inclusion of smaller cryptocurrencies of what they consider speculative assets. Coinbase CEO Brian Armstrong argued that only Bitcoin, as “a successor to gold,” should be included in such a reserve.
Commerce Secretary Howard Lutnick has suggested that Bitcoin might receive special status in the reserve while “other crypto tokens will be treated differently — positively, but differently.”
Hougan believes the final composition will evolve following input from industry leaders at the upcoming White House crypto summit. He predicts that “despite the flawed rollout,” the reserve will ultimately prove bullish for crypto markets, particularly Bitcoin.
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