Following an announcement made by Donald Trump to form the United States’ first strategic cryptocurrency reserve (SCR) on March 2nd, 2025, Bitcoin surged by a fifth (experienced a 20% increase) after experiencing a low rate less than $80,000 for three months The tokens listed for the reserve include Bitcoin, Ethereum, XRP, Solan’s SOL and Cardano’s ADA.
Two days prior to the SCR announcement, Bitcoin was trading at $78,273; after the announcement, its trade rates rose to $94,154. This decisive step by Trump signifies the US first step in incorporating cryptocurrencies into a strategic reserve and making the nation Crypto-friendly.
In January 2025, Trump signed an executive order to examine the creation of “strategic national digital assets stockpile” with the goal of strengthening the crypto industry after years of “stifling attacks” from the previous administrations.
Following the execution of this order, Trump, in a post on Truth social wrote “A U.S. Crypto reserve will strengthen this crucial industry after years of attacks from Biden’s Administration”, and he declared his intent to make “the US the Crypto Capital of the world.”
Why was the news of the Strategic Cryptocurrency Reserve a Game Change?
A strategic reserve is a stockpile of important resources valuable to the government or businesses kept for emergencies or a time of crisis. The reserves can range from: Financial reserves for funds and assets; Commodity reserves for goods or materials essential for the economy, this includes food, water, metals, minerals and medical supplies; Machinery reserves, which includes aircraft, ships, tanks and generators; and biological reserves (genetic materials).
Strategic reserves offer many benefits to its holders/holding country, some of which include but not limited to serving as a buffer for external shocks or uncertainties that could disrupt the economy; enhancing the ability of the system to adapt to any condition or demand; reducing dependence on foreign suppliers or markets; and creating a sense of security and confidence for the public.
In a Fact Sheet released by the White House on January 23rd, 2025, the Strategic Cryptocurrency Reserve (SCR) would be a stockpile of digital assets under a federal regulatory framework. The White House AI & Crypto Czar will chair the working group for the framework, including the Secretary of the Treasury, the Chairman of Securities and Exchange Commissions and other relevant departments and agencies.
The notice also implied that the working group would collaborate with experts in the field to ensure the actions of the group are “informed by expertise beyond the Federal Government”. The creation of the SCR by the US enhanced the industry’s potential by one main factor that strategic reserves provide: creating a sense of security and confidence for the crypto industry.
In a report by CBS news, the head of the US business at 21shares, Federico Brokate stated “the launch of a U.S. crypto strategic reserve marks a pivotal moment for digital assets, reflecting a major step in the government’s engagement with the crypto industry”.
This implies the SCR gives a sense of validation to cryptocurrency’s legitimacy and potential and the result of this is seen in the short-term surges the affected tokens experienced. And should the SCR be executed successfully, it could create an era of stability for cryptocurrency rates.
Bitcoin surged by 20% reaching $94,000, Ethereum climbed 11% to $2,500, XRP experienced a 30% increase to $2.80 and Cardano had a staggering surge of 60% to surpass $1. There are concerns however, regarding the long term effect of the SCR and its implementation due to the volatility of the crypto rates which makes it a “sketchy choice” for a national reserve.
