Bitwise: Market is Wrong About Trump’s Crypto Reserve, Long-Term Outlook is Bullish
The final version of the U.S. strategic crypto reserve will be mostly bitcoin and larger than expected, according to a recent Bitwise report.
Following President Trump’s announcement of the creation of a strategic crypto reserve, the crypto market initially surged but quickly erased its gains by Monday. However, in a report published Tuesday, asset manager Bitwise argues that the market has misread the situation and failed to recognize its long-term bullish implications.
Investor disappointment primarily stemmed from the inclusion of multiple cryptocurrencies instead of an exclusive focus on bitcoin. The initial announcement included XRP, Solana (SOL), and Cardano (ADA) in the reserve before later adding Bitcoin (BTC) and Ethereum (ETH).
“The addition of speculative assets like Cardano appears to be a politically motivated choice rather than a strictly strategic one,” wrote Matt Hougan, Chief Investment Officer at Bitwise. However, he contends that the market reaction is overlooking the broader significance of the reserve’s formation.
The report emphasized that Trump’s policies often evolve significantly before implementation. Given this, the final reserve is expected to be overwhelmingly composed of bitcoin and larger than the market currently anticipates.
Bitwise further noted that if the U.S. follows through with a strategic crypto reserve, it could encourage other governments to do the same. Any digital assets acquired for such reserves would likely be held for the long term, reducing available supply and supporting higher prices.
“The U.S. government classifying crypto assets as ‘strategic’ is a game-changing development,” the report concluded, predicting that market sentiment will eventually reflect the bullish reality of this policy shift.
