Crypto assets gave up some of their gains on Monday after getting a massive boost over the weekend from President Trump’s announcement of a new US strategic reserve of digital assets.
While Bitcoin dropped nearly 9% on Monday — after surging by 20% a day earlier — stocks of major US crypto firms initially soared on bets that the Trump administration is poised to execute an aggressively pro-crypto agenda in the months ahead.
The commander-in-chief said on Sunday that he plans to stockpile a basket of coins that include Bitcoin, Ether, XRP, Solana, and Cardano ahead of Friday’s first-ever White House crypto summit.
“Obviously, BTC and ETH, as other valuable Cryptocurrencies, will be at the heart of the Reserve,” he wrote on Truth Social. “I will make sure the US is the Crypto Capital of the World.”
Bitcoin, the world’s largest cryptocurrency by market value, fell to around $86,000 as of 4 p.m. ET on Monday, while Ethereum, the second-largest cryptocurrency, suffered a 16% decline, to just above $2,100 — after rising 14% on Sunday.
Investor Joe Lonsdale, the co-founder of Palantir and a close associate of Elon Musk, questioned the need for a strategic reserve of crypto.
“It’s wrong to steal my money for grift on the left; it’s also wrong to tax me for crypto bro schemes,” Lonsdale wrote on X.
However, stocks of top US crypto firms were up in Monday morning trading in New York on the back of Trump’s announcement before retreating later in the day.
Strategy, formerly known as MicroStrategy and the largest corporate holder of Bitcoin, fell nearly 3% in afternoon trading after surging 2% earlier in the day. Crypto miners Riot Platforms and MARA Holdings also gave up their gains after jumping 7% and 9%, respectively.
James Butterfill, head of research at asset manager CoinShares, said the idea “suggests a more patriotic stance toward the broader crypto technology space, with little regard for the fundamental qualities of these assets.”
Trump was a one-time crypto critic, calling Bitcoin a “scam” against the dollar in June 2021 before making a U-turn during the 2024 campaign.
But his new administration is set to take a lighter touch approach to regulating digital assets.
Digital asset investors have also been buoyed by his pick of pro-crypto lawyer Paul Atkins to run the Securities and Exchange Commission.
Many in the industry were unhappy with the previous administration’s SEC chair, Gary Gensler, who launched a string of lawsuits against crypto firms.
Kraken said earlier on Monday that the federal regulator had agreed to drop a Gensler-backed case brought in November 2023.
It accused the company of acting as a broker, dealer, and exchange without registering with the SEC.
Just last week, the financial watchdog agreed to toss a similar complaint against Coinbase, the largest crypto exchange in the US.
