The U.S. Government's National Crypto Reserve Proposal Sparks Controversy

The U.S. government's proposal to establish a national crypto reserve has sparked controversy

The U.S. government’s proposal to establish a national crypto reserve has sparked controversy, particularly due to the unexpected inclusion of assets like Ripple (XRP), Solana (SOL), and Cardano (ADA).

The plan, announced by former President Donald Trump during his administration, focused primarily on securing Bitcoin and Ether, deviating from traditional asset selection in favor of newer, more contentious cryptocurrencies.

"Is this real or a deep fake? I'm not sure I buy it. But wow, they're really putting Kamala on a coin," said Gemini co-founder Cameron Winklevoss, in response to a post about the crypto reserve.

"This is also ironic given how much the crypto community is split on whether or not Solana should be included in the national crypto reserve."

This article will delve into the implications of the U.S. move towards a national crypto reserve, examining the controversial addition of Ripple, Solana, and Cardano to the proposed assets.

Understanding the U.S. National Crypto Reserve Proposal

The recent announcement of a national crypto reserve by the U.S. government marks a significant shift in the financial landscape, targeting a range of digital assets that straddle the line between innovation and instability.

While the primary candidates for this reserve are Bitcoin and Ethereum, recognized for their relative market maturity and widespread adoption, the inclusion of assets like Ripple (XRP), Solana (SOL), and Cardano (ADA) has raised questions about the selection criteria.

According to a recent report by Blockware Solutions, the administration is planning to create a new class of "national reserve assets" to diversify U.S. holdings beyond traditional assets like gold and Treasury bonds.

The report, which cites anonymous sources familiar with the matter, also mentions that the administration is seeking to include cryptocurrencies in the reserve, a move that has sparked debate within the crypto community.

Reactions From The Crypto Community

The response from key industry figures has been mixed. Some welcomed the government's acknowledgment of cryptocurrencies at this level.

"Finally, the government is doing something smart!" said Verbitskii, founder of TYMIO. "They're putting together a national crypto reserve. But why is Solana on the list? It's a meme coin and they're shutting down their validator nodes. This feels like a joke."

But critics pointed out that the selected assets may not possess the qualities of reliability and decentralization necessary for a national reserve.

"The U.S. administration is planning to include Solana in its national crypto reserve?" asked one commenter on X, formerly Twitter. "Isn't Solana's model heavily reliant on venture capital funding, something that goes against the purpose of decentralized finance?"

The report also mentions that the administration is considering including Solana, known for its fast transaction speed and low costs, in the reserve. Solana has a total value locked (TVL) of $7.32 billion in decentralized finance, placing it fifth on DeBank's rankings.

The network is also attracting developers and users, but it has faced criticism for its association with the memecoin phenomenon and its previous outages.

According to reports, the recent upsurge in activity has raised alarms about its sustainability, leading some to question whether it can be sustained in the long term.

"This is the worst timeline," said another commenter. "They're putting Kamala Harris on an NFT and including Solana in a national crypto reserve. Someone pinch me."

The Solana skepticism stems from concerns over centralization and the heavy influence of venture capital, as highlighted by whistleblower Edward Snowden.

"If the crypto project is accepting large sums of money from venture capitalists to keep the chain running, then it's not really decentralized," said Snowden in a recent post. "And if it's not decentralized, then what's the point? We might as well stick with traditional finance."

This sentiment was shared by critics who argued that including Solana in a national reserve would be celebrating a model that goes against the foundational ethos of blockchain technology.

"We're not saying Solana is a bad chain, but it's not really decentralized enough for a national reserve," said one commenter. "It's also been the target of several attacks, which could leave the U.S. government vulnerable if any of the Solana tokens were to be stolen."

In contrast to Solana's speed, Cardano is showcasing a markedly slower approach to development, hoping that its research-driven strategy will pay off in the long run.

However, in a marketplace where speed and adaptability often dictate success, Cardano's TVL stands at a comparatively modest $412 million, highlighting a slower pace of user acquisition. This hesitation could be attributed to the perception that it lacks the dynamic engagement present within more rapidly evolving networks like Solana.

"Cardano is a great project, but I'm not sure it has the mindshare needed to be included in a national crypto reserve," said another commenter. "It