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Good morning! The entire crypto market rallied on Sunday after Trump made another weekend announcement. We’re breaking down the latest with the digital asset stockpile, plus we’re covering Warren Buffett’s quip on tariffs. First time reading? Join 190,000 self-directed investors gaining an edge every morning. Sign up here. 

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Bitcoin-only or nothing

The US doesn’t stockpile fool’s gold, so its crypto reserve shouldn’t be any different.   

On Sunday, President Trump announced in a Truth Social post the creation of a reserve that will indeed include bitcoin, as well as ether, XRP, Solana’s SOL, and Cardano’s ADA.

Predictably, the digital asset market surged after the news, with each of the mentioned tokens climbing double-digits. 

“A U.S. Crypto Reserve will elevate this critical industry after years of corrupt attacks by the Biden Administration,” Trump wrote.

“I will make sure the U.S. is the Crypto Capital of the World.”

In one sense it’s a positive sign for the digital asset industry that the White House is following through on its promise of a crypto reserve.

Yet the multi-token approach undermines the original premise of decentralization.  

A government-backed initiative implies stability, soundness, and national interest. It shouldn’t leave room for conflicts of interest with the private sector, and its holdings should be as immune to pump-and-dump schemes as gold.  

That’s why a US strategic crypto reserve should only include bitcoin. 

Think about it. Bitcoin — unlike ether, XRP, SOL or ADA — does not have a CEO or controlling entity. The largest cryptocurrency has gained such traction because it is permissionless and immutable.

The bitcoin network, too, has never been hacked.

The others, meanwhile, have largely become popular from broader momentum and corporate strategy. The SEC has targeted XRP for its ties to Ripple, the Ethereum Foundation has its own leadership and software hiccups, and Solana has a spotty history of outages. 

A US reserve that includes assets like these will look more like a venture portfolio than a strategic store of value. If White House officials want the former, they should save it for the sovereign wealth fund, which is also reportedly in the works.

The incentives become murky once the government extends beyond bitcoin. Hand-selecting which tokens are included in a federal initiative injects a layer of favoritism into what should be an agnostic process. 

What happens if one of the organizations behind a cryptocurrency in the reserve makes a decision that contradicts US interests? 

Imagine if Fort Knox only held gold mined from specific companies. Or if the Strategic Petroleum Reserve exclusively picked barrels from certain crude fields. 

At best there is a moral hazard at play; at worst corruption.  

To be clear, crypto markets have cheered President Trump’s move to solidify a reserve. But over the long run, its composition will determine its credibility. 

Every major economy holds a strategic gold reserve because the asset is scarce, durable, and independent from any one entity.

If bitcoin is indeed the digital equivalent, a bitcoin-only reserve makes sense. 

Elevating speculative projects to the same level turns the whole project into pro wrestling.

Market snapshot:

Elsewhere:

📊 Warren Buffett called Trump’s tariffs a tax on goods. The 94-year-old made a rare political-related comment in a new interview: “Over time, they are a tax on goods. I mean, the Tooth Fairy doesn’t pay ‘em!” (CBS)

🚢 Trump’s Treasury chief said tariffs won’t cause inflation. Scott Bessent said new levies are unlikely to fuel price growth, in part because China will “eat any tariffs that go on.” He said Mexico is likely to match US tariffs on China, and urged Canada to do the same. (CNBC)

🌍️ Over 120,000 leaders trust this global affairs newsletter. Dedicated to clarity over clickbait and designed by former diplomats, International Intrigue helps you stay informed in under 5 minutes a day. Join Pentagon officials and changemakers — sign up free here. 

🇺🇦 Trump and Zelenskyy’s disagreement has economic repercussions. The Oval Office spat led to no minerals deal being signed. In the short run, Trump’s campaign to redefine the US’ relationship with the rest of the world could stimulate economic growth via greater fiscal spending. Yet the longer-term effects are potentially less beneficial. (Barron’s)

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Last thing:

About me:

📰 I’m Phil Rosen, co-founder and editor-in-chief of Opening Bell Daily. I’ve published books, lived on three continents, and won awards for my journalism, which has appeared in Business Insider, Fortune, Yahoo Finance, Bloomberg and Inc. Magazine.

I write our flagship newsletter to prepare you for each trading day, unpacking markets, economic data and Wall Street with analysis you won’t find anywhere else. Feedback? Write me at [email protected], reply directly to this email, or ping me on X @philrosenn.