Trump’s Cryptocurrency Reserve Plan
Former U.S. President Donald Trump has announced plans to incorporate five cryptocurrencies into a new strategic reserve, a move that has sent ripples through the digital asset market. The announcement, made via a Truth Social post, follows a January executive order on digital assets and signals a potential shift in the U.S. government’s approach to digital currencies.
Trump initially named XRP, Solana (SOL), and Cardano (ADA), surprising many with his selection of lesser-known tokens. He later added Bitcoin (BTC) and Ether (ETH), the two largest cryptocurrencies by market capitalization, to the list.
Here’s a breakdown of the tokens included in Trump’s proposed reserve:
XRP
Created by the U.S. crypto company Ripple, XRP is the world’s third-largest cryptocurrency. Data from CoinGecko indicates approximately $140 billion worth of XRP tokens are in circulation, with each token valued around $2.40. Ripple aims to facilitate faster and cheaper international fund transfers compared to traditional methods and even Bitcoin.
XRP’s price, like other cryptocurrencies, has experienced volatility. Ripple has also been a significant player in crypto lobbying, donating $45 million to a lobbying group that supported candidates favoring the crypto industry, according to OpenSecrets.
Notably, Ripple CEO Brad Garlinghouse posted a photo with Trump, stating they had a good dinner. The company has been involved in a legal dispute with the U.S. Securities and Exchange Commission (SEC) concerning the offering of XRP sales in 2012. While Ripple achieved a partial victory in this case, the SEC was also partially successful. A Ripple spokesperson directed Reuters to a tweet by Garlinghouse where he appreciated Trump’s “vision of a govt digital asset reserve representative of the industry.”
Solana (SOL)
SOL is the token associated with the Solana blockchain. The Solana blockchain is frequently utilized for launching meme coins, including Trump’s own cryptocurrency, which he introduced in January.
CoinGecko data indicates approximately $73 billion worth of SOL tokens in circulation, making it the sixth-largest cryptocurrency. However, it has experienced significant price volatility, losing a substantial portion of its value in 2022, partly due to its association with former FTX CEO Sam Bankman-Fried.
Solana’s price soared in 2021 amid industry conversations about its potential as a competitor to Ether and its use in booming non-fungible token (NFT) markets. The Solana Foundation, a non-profit organization based in Switzerland, manages the project, with Lily Liu and Daniel Albert as executive directors.
Cardano (ADA)
ADA operates on the Cardano blockchain, which was established in 2015 by Charles Hoskinson, a well-known U.S. tech entrepreneur and co-founder of the Ethereum blockchain project. CoinGecko data reveals that there are $31.4 billion worth of ADA tokens in circulation, making it the eighth-largest cryptocurrency. The token’s price surged after Trump’s announcement, briefly increasing over 70% from its level on Friday.
Cardano’s website lists five entities, including the Switzerland-based Cardano Foundation and a for-profit arm named Emurgo. Cardano has been requested for comment.
Bitcoin (BTC)
Bitcoin, the first and largest cryptocurrency, emerged in 2009, created by an anonymous figure known as Satoshi Nakamoto. Bitcoin enables individuals to transfer money without intermediaries such as banks. Data from CoinGecko reveals that one Bitcoin is valued approximately $86,000, with approximately $1.7 trillion worth of tokens in circulation. This represents over half of the total $3 trillion nominal value of all digital currencies.
Bitcoin’s value increased last year, benefiting from the U.S. SEC’s decision in January 2024 to allow its inclusion in exchange-traded funds and Trump’s election in November, which raised expectations for pro-crypto regulations.
Ether (ETH)
Ether is the cryptocurrency of the Ethereum blockchain, a major player in decentralized finance (DeFi), which uses blockchain technology to offer financial services without intermediaries. Its value is the second largest after Bitcoin.
Founded between 2013 and 2014 by Vitalik Buterin and others as a competitor to Bitcoin, the token’s value is a fraction of Bitcoin’s, but it remains the second-largest cryptocurrency. World Liberty Financial, a crypto company that Trump and his sons announced last year, has issued digital tokens on the Ethereum blockchain and has thus far sold them for over $500 million.
World Liberty announced in February that it was launching a strategic token reserve intended to support bitcoin, Ethereum, and other cryptocurrencies “that are at the forefront of reshaping global finance.”
