All eyes on Washington as speculation builds around Trump’s proposed Bitcoin reserve

In a week of market swings, all eyes are on Washington as speculation builds around Trump’s proposed Bitcoin reserve. With prices hovering

The crypto market is buzzing with anticipation as speculation around Trump's proposed Bitcoin reserve continues to heat up.

Now, one Fundstrat analyst is weighing in on the buzzed-about topic, breaking down why the administration's plans might not necessarily translate into a big price move.

Sean Farrell, who has been closely following the saga, pointed out that the details of the reserve remain shrouded in mystery.

"We still don’t know how they actually plan to implement this reserve, when they plan to do it, how big it will be, what assets, what will the criteria be for the assets that are included?" Farrell said.

The market initially reacted positively to the news, but the uncertainty — and some surprising asset inclusions in Trump's Truth Social posts — left investors a bit hesitant, in his view.

"Had there been more certainty around the reserve and had there not been some suspect assets like Cardano, Solana, and Ripple, which I feel pretty strongly that Bitcoin is the only asset, crypto asset, that has a place in any strategic asset portfolio, we would have seen a little more follow-through," Farrell added.

While he acknowledged that altcoins like Solana and Cardano have speculative value, the idea of the government picking winners among what he called "quasi tech stocks" introduces "some perverse incentives."

"The two assets in Cardano and Ripple are essentially, you know, call a spade a spade, they’re ghost chains. I’ve never met anyone, really, outside of people that are involved with the projects that use those chains," Farrell said, highlighting data showing minimal real-world activity on the respective blockchains.

The inclusion of Solana is also interesting, especially with institutional adoption of the coin heating up.

"Solana has a very appetizing story here, and I still like adding Solana here. We have major unlocks already behind the project and we’re going to get CME futures in Solana on March 17, which I think would be a logical progression of events given that we already have the Bitcoin futures, which we’re going to get a new batch of on March 26," Farrell said.

He added that a Solana ETF could also be a strong possibility, despite the market's lackluster response to the Ethereum ETF debut.

"We didn't see a huge pop because I think we were wading through a macro backdrop that was, you know, global risk moving lower expeditiously."

The macroeconomic headwinds have made price predictions difficult, but Farrell highlighted that we could be getting close to a tactical turning point.

"It has become clear that Trump is actually going to have to fire this gun to show that it works. We're still getting threats of a trade war, which I think would be a macroeconomic event that would have to be digested by the markets before we saw a move in risk assets higher, which we've seen none of this year, as we've been steadily digesting risk. So I do think at least from a tactical perspective, we could be getting near a point where you’re going to want to get more long."

The administration is expected to fully clarify its plans at Friday's crypto summit. According to Farrell, the key questions are whether actual taxpayer dollars will be used to buy Bitcoin or if the government will simply hold onto seized assets.

"If we have a scenario in which they come out and announce their intention to just not sell seized assets, I’m not sure that does too much for price. I think that’s already priced in. But if they do plan to allocate a percentage of its gold reserves into Bitcoin, which I asked the administration directly about and they didn't respond, I think that would move the market more."

He noted that an announcement of a 1% allocation would probably not have a huge impact.

"But if they said 10%, I think that would move the needle."

Even with the uncertainty, Farrell's long-term outlook remains unchanged.

"I haven't changed my medium to long-term thesis, but we’re just kind of reading and reacting right here."

With Bitcoin's $175,000 price target still in his sights, the next move could hinge on whether the government's reserve plans amount to anything more than another round of headlines. Friday's summit might provide the answers — but if history is any guide, it could just bring more questions.