Self-proclaimed ‘crypto president’ Donald Trump made big promises to the crypto community. He built a strong alliance with crypto investors, taking millions in campaign donations and vowing to make the US the “crypto capital of the planet.” Trump talked about cutting down on regulations, prioritizing Bitcoin, and even signed an executive order for a national stockpile/reserve, or at least that’s what he’s deluded himself into calling it. Before that, he pardoned Silk Road creator Ross Ulbricht (a hero in the community) and the SEC dropped its case against Coinbase, TRON, Gemini, and Kraken. Everything looked great. Then he took it too far. Over the weekend, Trump announced a US strategic crypto reserve, not just for Bitcoin but also for Ether, XRP, Solana’s SOL, and Cardano’s ADA. That’s when everything changed. Screenshot of President Donald Trump’s crypto reserve announcement. Source: Donald Trump ((x/Twitter) His crypto supporters, the same people who backed him for cutting red tape, suddenly saw a massive problem. Buying Bitcoin with government money is one thing. Buying a mix of unproven shitcoins? Oh no, the community turned on him so fast. But there’s also something else at play here. The blatant market manipulation and insider trading that’s going on is truly heartbreaking. A whale opened up some long positions on Bitcoin and Ether literally 4 hours before Trump made the announcement when the market was wobbly. After the announcement, the whale closed their position and cashed out on tens of millions of dollars. The very next day, another whale opened up short positions merely hours before Trump made the announcement to go ahead with tariffs on China, Mexico, and Canada. The consensus in the community is that the Trump family is just playing us all, especially since Eric Trump keeps posting and telling people to “HOLD (long-term).” Trump did rugpull crypto investors with his MELANIA and TRUMP meme coins in January, and as Cryptopolitan reported , crypto scammer Hayden Davis himself admitted that Trump was in on the dubious operation. Hayden was involved in deploying both meme coins. It’s pretty clear that Trump doesn’t actually take this industry seriously at all. Once again, the real estate showman has hoodwinked us all, just as Arthur Hayes predicted months ago. Crypto investors call out Trump’s risky plan Anyway, after Trump name-dropped those so-called altcoins in his ridiculous announcement, crypto elites were fast to react. Brian Armstrong, CEO of Coinbase and a part of Trump’s crypto inner circle, said on X: “Excited to learn more. Still forming an opinion on asset allocation, but my current thinking is: 1. Just Bitcoin would probably be the best option – simplest, and clear story as successor to gold 2. If folks wanted more variety, you could do a market cap weighted index of crypto assets to keep it unbiased. But probably the first option is easiest.” Joe Lonsdale, founder of 8VC and a proud Trump supporter, also lashed out at the administration, saying, “Taxation is theft. It’s wrong to steal my money for grift on the left; it’s also wrong to tax me for crypto bro schemes.” Many Americans will probably agree with Joe. I mean, they want less taxes, and less government spending, not more. Using taxpayer funds to buy something as volatile as Solana is an economic scam no matter how you look at it. David Sacks, the venture capitalist tapped as White House AI and crypto czar tried to calm things down. “Nobody announced a tax or a spending program,” he told Joe on X. “Maybe you should wait to find out what’s actually being proposed.” But that didn’t stop the backlash. Naval Ravikant, an early crypto investor, called the plan “exit liquidity for cryptocurrencies that are decentralized in name only.” Vinny Lingham, another longtime investor, wrote: “I don’t think the government should be pumping our crypto bags with taxpayer money while we are running a near $2 trillion deficit.” Tyler Winklevoss, billionaire Bitcoin investor and long-term Trump supporter, is also speaking out. “I have nothing against XRP, SOL, or ADA, but I do not think they are suitable for a Strategic Reserve,” he said. “Only one digital asset meets the bar, and that digital asset is Bitcoin.” Trump triggers a market crash — again Over the weekend, there was an initial rally after Trump’s announcement. But by Monday afternoon, Bitcoin had fallen 9%, Ether was down 15%, and XRP and SOL tumbled by 11% and 16% respectively. Traders saw the backlash and realized that Trump’s plan wasn’t as solid as it seemed. But I mean, when has a Trump plan ever been solid? The guy runs on pure vibes and little foresight. As proof of that, take a look at the unnecessary fight he has picked with Canada, America’s friendliest, most reliable ally. But there were still a few voices in the crypto community defending Trump. Michael Saylor, executive chairman of MicroStrategy, stood by him. His company holds $43 billion in Bitcoin, making it the biggest institutional investor in the history of the market. “There’s no way to interpret this other than bullish for Bitcoin and the entire US crypto industry,” he told CNBC, which frankly disappointed the author of this article a little bit, seeing as Saylor is a self-proclaimed Bitcoin maximalist, and Trump’s first post didn’t even mention Bitcoin. Someone likely had to remind him, and then he made a second announcement, going, “Oh but of course, Bitcoin too.” The OG post only mentioned the shitcoins. How bizarre is that? He never mentioned ADA and XRP on the campaign trail when he wanted to win over the industry. He only spoke about Bitcoin. But when the CEO of Ripple (Brad Garlinghouse) and the creator of Cardano (Charlie Hoskinson) allegedly hung out with him in Mar-a-Lago more than once, suddenly, Trump’s pro-XRP, he’s pro-ADA. I doubt he even knows the first thing about either network. But Bitcoin doesn’t have a face attached to it, it doesn’t have lobbyists, and chances are, Satoshi Nakamoto isn’t even American, so why should Trump care? Had Satoshi gone to see him and dropped a cool $5 million into the jar, the president would’ve remembered to mention Bitcoin for sure. This guy is a businessman. There’s over a dozen videos of him online basically telling the world he loves making money more than anything. If there’s no money in it for Trump, he’s not gonna give anything the time of day. That’s just the kind of person he is, and we’re not judging him for who he is. Just stating an obvious trait. Now, Anthony Pompliano, a well-known crypto investor, spent over 1,500 words in his newsletter breaking down why the move was a mistake. He argued that Trump was influenced by the wrong people. “We watched crypto projects, lobbyists, and special interest groups co-opt the President of the United States,” Anthony wrote. He said they convinced Trump to support US-made tokens, which fit perfectly with his America First agenda. “The world is not going to be run on XRP or ADA. People don’t use those assets right now in the same way they use Ethereum, Solana, or Bitcoin. Again, there is nothing strategic about this,” said Anthony. Anthony also believes that: “Trump is potentially negotiating in public with this announcement. If he wanted to get a bitcoin strategic reserve done, then The Art of the Deal would suggest Trump should ask for much more at the outset. As the idea of the reserve works through the political process, Trump is well positioned to give up the idea of adding altcoins to the reserve and can fall back on only adding bitcoin.” Bitcoin supporters fear government control The deeper issue though is that many in crypto (including this author) don’t trust any government to handle Bitcoin or any digital asset. Nic Carter, a partner at Castle Island Ventures, says it best: “We don’t need Bitcoin or any other crypto asset to trade at any specific price.” Nic added that the US government doesn’t need to hold crypto reserves because it has no liabilities tied to them. “I don’t see why we would disrupt ourselves. It throws global markets into upheaval again.” There’s also the question of what this will even do to or for the US economy. Senator Cynthia Lummis proposed a Bitcoin reserve bill last year, arguing that the US could cut its debt in half in 20 years just by holding Bitcoin. Cynthia’s logic is that Bitcoin’s price keeps going up, so the government could eventually sell it for a massive profit. But I’m personally not convinced. Do we really have to point out that just because Bitcoin has gone up in the past doesn’t mean it always will? Come on now. Stephen Cecchetti, an economist, compared the whole strategic reserve idea to gambling on credit cards to pay off a mortgage. “Using US debt to buy a large amount of crypto could increase the likelihood that credit rating agencies would downgrade the US, increasing the cost of borrowing,” Stephen said. Even if the Bitcoin reserve worked, there’s another problem: What happens when the US government decides to sell? A massive sell-off could crash Bitcoin’s price, wiping out gains for everyone else. That’s why many crypto believers, like me, don’t want the government involved in the first place. I mean, this goes against everything Satoshi envisioned in the Bitcoin whitepaper. Whoever he is, wherever he is, dead or alive, chances are he is disappointed and horrified at what we’ve managed to turn his perfect creation into. I’m honestly embarrassed for us all.
