Market Reactions to Trump’s Crypto Reserve Announcement
On Sunday, President Trump ignited a significant short squeeze in the cryptocurrency market with his announcement regarding a potential crypto reserve. However, as trading commenced on Monday morning in the U.S., the initial gains began to reverse sharply.
Bitcoin (BTC), which had surged following Trump’s post, has now experienced a decline of approximately 5% within the last hour, bringing its trading price down to $89,500. While this price is still higher than the $85,000 mark prior to the president’s announcement, it has fallen from a peak of $95,000.
The other cryptocurrencies mentioned in Trump’s post, including ether, solana, XRP, and cardano, also saw notable increases initially but have since retraced a significant portion of those gains.
Arthur Hayes, a prominent figure in the crypto space, commented on the situation, stating, “Nothing new here. Just words. Let me know when they get congressional approval to borrow money and/or revalue the gold price higher. Without that, they have no money to buy bitcoins and other altcoins.”
Quinn Thompson, the CIO of Lekker Capital, also weighed in on the matter, expressing skepticism about the potential benefits of Trump’s announcement for the crypto community. “If you’re in crypto and cheering this, I don’t know what to tell you,” he remarked on Sunday. “There’s just no way that legitimizing two of the largest grifts and scams in the history of the industry is a good thing. You can blame it on the administration being ignorant, misinformed, or bought, but this ain’t it.”
Thompson further predicted that the Trump administration might inadvertently provide crypto traders with yet another classic “sell the news” opportunity, making it the tenth such instance this year.
In tandem with the broader market pullback, several crypto-related stocks are also showing signs of decline after their early gains. Among these stocks are Coinbase (COIN), MicroStrategy (MSTR), Semler Scientific (SMLR), and Hut 8 (HUT).
