Arthur Hayes Slams US Crypto Strategic Reserve Announcement

Following US President Donald Trump’s announcement of a Crypto Strategic Reserve, some industry figures have questioned the possibility of its establishment. Market watchers have also expressed concern about the longevity of the Trump-fueled market recovery.

Arthur Hayes Slams Crypto Reserve Announcement

BitMEX founder Arthur Hayes expressed skepticism about the recently announced US Crypto Strategic Reserve. In an X post, he deemed the US President’s statement as “just words,” questioning the feasibility of the reserve without the US Congress’s approval.

According to Hayes, the announcement didn’t offer any new information to the public, as the government will need to “get congressional approval to borrow money and/or revalue the gold price higher. Without that they have no money to buy #bitcoin and #shitcoins,” he stated.

On Sunday, President Trump announced the establishment of a “US Crypto Reserve” to elevate the “critical industry after years of corrupt attacks by the Biden Administration.” The news follows Trump’s January 23 executive order, “Strengthening American Leadership in Digital Financial Technology.”

The order directed the Presidential Working Group on Digital Assets to study the viability of a potential crypto reserve while affirming the new administration’s support for blockchain technology and digital assets.

On his social media platform, Truth Social, the US president revealed that the strategic reserve would incorporate some of the top cryptocurrencies made in the USA, including Solana (SOL), Cardano (ADA), and XRP.

In a second post, President Trump affirmed that Bitcoin (BTC) and Ethereum (ETH) would “be at the heart of the reserve,” expressing his support for the top two cryptocurrencies by market capitalization.

White House AI and Crypto Czar David Sacks shared the announcement, stating that it was “consistent with his week-one E.O. 14178” and “President Trump is keeping his promise to make the U.S. the ‘Crypto Capital of the World.’” Additionally, Sacks announced “more to come” at the upcoming White House Crypto Summit.

A Seized US Strategic Reserve ‘Not As Bullish’

Bybit’s CEO, Ben Zhou, agreed with Hayes’ comment, replying “exactly” to his X post. Meanwhile, some market analysts shared concerns about funding the US digital asset reserve.

Ali Martinez noted that the strategic reserve “wouldn’t become a reality overnight” as Congress must “draft, debate, and pass legislation.” The analyst added that funding sources would need to be allocated, and agencies like the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), and the Department of the Treasury must establish a compliance framework.

Martinez questioned what would happen if the legislation didn’t pass Congress, pondering whether the market pump would “be undone” and reinforce the recently seen bearish sentiment.

IG market analyst Tony Sycamore stated on X, “While this announcement has significantly boosted prices, it has also raised concerns.” According to the analyst, funding from digital asset purchases would “likely come from taxpayers,” as the government carries $36 trillion in debt.

“Alternatively, they might be sourced from the substantial amount of crypto the government has confiscated over the years from criminal activities, including the 144,000 Bitcoin seized from Silk Road in 2013,” he also suggested.

However, Sycamore considers a strategic reserve made of the US-seized crypto assets “isn’t anywhere near as bullish as it simply represents a transfer between accounts rather than new buying entering the market.”

Nonetheless, some community members argued that Trump’s announcement contains “a lot of ‘new here’,” since the US President is “essentially signaling to every country in the world that a crypto arms race is starting and the most important assets are BTC and ETH.”

Bitcoin's performance in the one-week chart. Source: BTCUSDT on TradingView

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