Trump's announcement of a 'strategic national bitcoin' reserve temporarily boosts crypto prices

The announcement provided a temporary boost to crypto prices after recent declines. Bitcoin, for instance, was trading around $90,000 on Monday morning

After a recent decline, crypto prices rose again after former President Donald Trump said in an interview that he would create a "strategic national cryptocurrency reserve" if re-elected.

During his campaign, Trump promised to support a "strategic national bitcoin reserve," which would involve Bitcoin seized by the U.S. government in law enforcement actions.

On Sunday, he went a step further, announcing plans to hold other types of cryptocurrencies as well.

"If I'm elected, we'll be creating a strategic national cryptocurrency reserve, where we'll hold the largest units of Bitcoin, Ethereum, XRP, Solana, Cardano, and other digital assets," Trump said in an interview with the Good Morning America program on the ABC television network.

The White House did not immediately provide details on how much of each cryptocurrency Trump proposed the U.S. should hold, how the administration would acquire the assets, or whether other types of digital assets would be included in the reserve.

The president's son, Eric Trump, expressed satisfaction with the price increases, which came after he advised people to buy and hold crypto assets on his social media accounts.

"Hopefully, I made someone's life just a little bit better," Eric Trump post on Monday.

Trump has positioned himself as a champion of the crypto industry, which he said had been subjected to "years of corrupt attacks by the Biden administration."

The industry, which felt unfairly targeted by the Biden administration, supported Trump's election bid. His initial weeks in office saw several measures aimed at bolstering crypto, such as halting prominent enforcement actions by the Securities and Exchange Commission.

Following Trump's election victory last year, crypto prices soared. Trump claimed credit when Bitcoin surpassed $100,000 early in December, posting "YOU'RE WELCOME!!!" on his social media accounts.

However, prices have since decreased after the inauguration, and Trump faced criticism, even from allies within the crypto industry, for his involvement in launching a personal meme coin just before taking office, which later plummeted in value.

The crash of meme coins associated with First Lady Melania Trump and Argentine President Javier Milei, along with a major cryptocurrency exchange hack attributed by the FBI to North Korea, dampened enthusiasm for crypto.

The inclusion of cryptocurrencies other than Bitcoin is expected to be met with resistance from some factions within the divided cryptocurrency industry. Bitcoin, being the oldest and most dominant cryptocurrency, constitutes over half of the global crypto market cap.

Those in favor of a government-held crypto reserve argue that it would diversify government assets and mitigate financial risks. However, critics contend that the volatility of cryptocurrencies renders them unsuitable as reserve assets.

In addition to Sunday's announcement, Trump recently disclosed plans to convene and engage with industry leaders at a White House "Crypto Summit" scheduled for Friday.