U.S. President Donald Trump's crypto reserve plan has rattled the market

U.S. President Donald Trump's crypto reserve plan has rattled the market, with many questioning why Bitcoin isn't the sole focus.

U.S. President Donald Trump's crypto reserve plan has rattled the market, with many questioning why Bitcoin isn't the sole focus.

According to Bitwise investment chief Matt Hougan, “Market participants have soured on the announcement because the proposed reserve holds more than Bitcoin.”

Trump initially said the reserve would include Solana (SOL-USD), XRP (XRP-USD), and Cardano (ADA-USD) before later clarifying that Bitcoin and Ethereum would be its “heart.” However, Hougan believes that “after the dust settles, the final reserve will be nearly entirely Bitcoin, and it will be larger than people think.”

Bitcoin's Price Swings as Investors Scramble to Plan

Bitcoin initially surged on Trump's announcement, seen here on Benzinga Pro, before dropping below $83,000.

It is an honor to announce that the U.S. will be launching a cryptocurrency reserve to secure our national interest in the digital age. The reserve will hold significant units of Bitcoin, Ethereum, Solana, XRP, and Cardano. This is a critical step in safeguarding our economic stability and technological leadership. We are also working closely with Coinbase (COIN) to facilitate the purchase and management of these digital assets. Together, we will ensure that the U.S. remains at the forefront of the global cryptocurrency revolution. #Bitcoin #Cryptocurrency #InvestNow

— Donald Trump Jr. (@DonaldJTrumpJr) August 10, 2023

However, investors expected a Bitcoin-only reserve, with Coinbase CEO Brian Armstrong comparing Bitcoin to "a successor to gold" and criticizing the inclusion of altcoins.

Yet, Hougan stated that the market is "misreading things" and that despite a messy rollout, "this is bullish."

Global Bitcoin Demand Could Soar

Seeing as the U.S. is now treating Bitcoin as a strategic asset, Commerce Secretary Howard Lutnick hinted that Bitcoin could receive special status.

As a result, Hougan added that if the U.S. pulls through with this plan, “other countries will look at wanting their own slice of Bitcoin.”

The crypto market may be shaken by Trump's announcement, but the long-term impact could be huge.