Bitwise executive: BTC could become the cornerstone of U.S. crypto asset reserves
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Bitwise executive: BTC could become the cornerstone of U.S. crypto asset reserves
The sell-off was driven by market concerns that the structure of the reserve was motivated more by political purposes than strategic considerations.
Navigating Web3 tides with focused insightsAuthor: cryptoslate
Translation: Blockchain Knight
Bitwise Chief Investment Officer Matt Hougan believes the market has misunderstood the impact of President Donald Trump's proposed Strategic Crypto Asset Reserve plan. He argues that despite initial volatility, the initiative will ultimately benefit digital assets.
Hougan predicts the final reserve will be predominantly composed of BTC and likely far exceed industry expectations in scale.
He also suggests other countries may accelerate their own BTC acquisitions as a result, and once the U.S. completes its purchases, it may never sell its holdings—or at least not for a very long time.
Industry Concerns
On March 2, Trump announced plans to establish a reserve including digital assets beyond BTC, initially sending BTC prices surging from $85,000 to $95,000. However, on March 3, BTC prices pulled back due to skepticism over the inclusion of other crypto assets and escalating geopolitical tensions.
According to Hougan, the sell-off stemmed from concerns that the reserve structure was driven more by political motives than strategic considerations, leading to negative sentiment spreading across the market.
Industry leaders including Coinbase CEO Brian Armstrong and Nic Carter, co-founder of Castle Island Ventures, have criticized the proposal to include speculative assets such as Cardano (ADA).
Bitwise CEO Hunter Horsley has also advocated for holding only BTC—a view aligned with broader market sentiment that such an approach would offer greater stability.
Nevertheless, Hougan believes the market overreacted. He says the initial proposal has already shifted the debate, making a BTC-only reserve a more plausible outcome.
"The boldness of the initial proposal widened the Overton Window," Hougan stated.
He also believes the announcement represents only a first draft, and the plan is likely to evolve further as the industry provides feedback to the Trump administration.
Hougan further emphasized that regardless of how the final version takes shape, the core concept of a government-backed reserve remains a long-term positive for the industry.
Global Ripple Effects
Hougan also highlighted that this move could have broader geopolitical implications beyond the U.S., suggesting other nations may now feel compelled to build their own BTC reserves, accelerating global adoption.
"El Salvador, Bhutan, and Abu Dhabi have already made strategic BTC acquisitions. If you're Honduras, Mexico, or Guatemala, and you see El Salvador and the United States acting, can you afford to be left behind? If you're Dubai, Qatar, or Saudi Arabia, won't Abu Dhabi’s lead push you into action?" Hougan said.
White House crypto advisor David Sacks is set to host a crypto summit on March 7, where industry leaders are expected to push for revisions to the reserve structure. Sacks recently revealed that Trump will unveil further details about the reserve during the event.
Long-Term Policy Implications
Hougan also addressed concerns about future administrations potentially reversing the policy, arguing that from a political reality standpoint, such an outcome is unlikely.
He noted that crypto assets have gained strong support among certain voter demographics, making it difficult for Democrats to outright oppose the issue.
"Republican embrace of crypto won votes in the last election, while Democratic hostility gained little traction. Any purchased crypto assets will likely be held long-term, much like America’s gold reserves," Hougan said.
While the market’s initial reaction has been mixed, Hougan views the establishment of a U.S. Strategic Crypto Asset Reserve as a turning point.
Whether the final reserve includes multiple assets or only BTC, the broader takeaway is clear: the U.S. government now treats crypto assets as strategic holdings—a stance that could have profound and lasting effects on global markets.
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