Trump’s Announcement Sparks Crypto Rally
In a stunning move, U.S. President Donald Trump unveiled plans to establish a national strategic reserve for cryptocurrencies, including Solana (SOL), Cardano (ADA), and XRP. This announcement sent these digital assets soaring by as much as 60% over the weekend. However, traders are exercising caution as they await further clarity on the feasibility of these plans.
Traders Exercise Caution Amidst Market Excitement
Kevin Guo, director of HashKey Research, expressed a cautious outlook regarding the recent price surge. “While the current upward momentum is encouraging, we may see a correction in the short term as investors digest the implications of the crypto reserve announcement,” he shared in a Telegram message to CoinDesk.
Guo highlighted potential legal challenges, noting that Federal Reserve Chairman Jerome Powell previously stated that the central bank is not permitted to hold a reserve of Bitcoin. “There are still technical hurdles that need to be addressed before Trump’s plans can be fully realized,” he added.
Upcoming Crypto Summit: What to Expect
Trump is set to host the inaugural Crypto Summit at the White House on March 7, where he is expected to provide additional insights into how cryptocurrency regulations and businesses will be supported in the United States. This event could offer further details that may bolster the crypto market’s recovery from recent downturns.
Immediate Market Reaction and Broader Trends
Following Trump’s announcement on Truth Social, which included additional assets like Bitcoin and Ethereum in the proposed strategic reserve, the cryptocurrency market reacted positively. Bitcoin surged 6.5%, surpassing $93,000, while the broader market, as tracked by the CoinDesk 20 (CD20), experienced a 7% increase.
Additionally, tokens such as Chainlink’s LINK, Uniswap’s UNI, and Movement’s MOVE rose by 8% in the past 24 hours, largely due to their affiliation with the Trump-family backed World Liberty Financial.
Future Volatility and Market Sentiment
Despite the current market uptick, experts caution that more work remains before this rally can be deemed sustainable. Chris Yu, CEO of SignalPlus, noted, “We anticipate increased volatility until further details solidify the creation of the strategic reserve. However, the swift shift in crypto market sentiment suggests a potential continuation of the bull market.”
Yu emphasized the importance of monitoring inflows into U.S.-traded ETF products, especially following recent record outflows. An increase in these inflows could signal a market bottom and pave the way for a sustained bull run.
