Bitwise chief investment officer Matt Hougan predicts that despite initial plans to include several large-market cap altcoins, US President Donald Trump’s proposed crypto reserve will eventually consist almost entirely of Bitcoin. Market participants have expressed concerns over the inclusion of smaller-cap assets, which they believe unnecessarily complicated the announcement.
Initially, Trump announced that the reserve would include Solana (SOL), XRP (XRP), and Cardano (ADA), later clarifying that Bitcoin (BTC) and Ether (ETH) would form “the heart” of the reserve. Hougan anticipates that after initial adjustments, the final reserve will be predominantly Bitcoin and larger than anticipated.
Bitcoin’s price saw an initial surge following news of its inclusion but later dropped below $83,000, only recovering to above $90,000 recently, partly due to Trump delaying auto parts tariffs on Canada and Mexico. Some crypto commentators, including Coinbase CEO Brian Armstrong, argue that Bitcoin is the only cryptocurrency suited for the reserve, likening it to “a successor to gold.”
Hougan criticized the inclusion of speculative assets like Cardano, suggesting that despite the flawed rollout, the market is misinterpreting the situation. He believes that Trump’s initial proposals are rarely final and that input from industry leaders at the upcoming White House crypto summit could alter the reserve’s composition. Commerce Secretary Howard Lutnick hinted that Bitcoin might receive special status, with other crypto tokens treated differently but positively.
There is a small chance that pushback could lead to the reserve being scrapped or limited to seized assets. Hougan also suggested that if the US creates a crypto reserve, other countries might follow suit. He added that any crypto purchased by the US is likely to be held long-term, akin to the country’s gold reserves, regardless of political changes.
Democratic leaders are unlikely to alienate pro-crypto voters, Hougan noted, highlighting the political significance of crypto. “There are a significant number of people who love crypto and a relatively small number who hate it,” he said. “We learned this in the last election, where the GOP’s courtship of crypto gained it many votes while Democratic hostility gained few.”
Hougan concluded that the market’s initial bullish reaction was appropriate, stating, “I think the market will eventually realize that.”
— news from Cointelegraph