An American crypto strategic reserve seems more likely after President Trump’s announcement during the weekend, Wall Street Citi (C) said in a research report on Monday.
The president announced that XRP, Solana (Sol) and Cardano (ADA) would be included in a strategic reserve, then add Bitcoin (BTC) and ether (ETH) to the list of assets.
“The announcement of new plans for the American government potentially becoming a strategic holder of digital assets would add to perceived legitimacy” of the asset class, analyst Alex Saunders wrote.
Citi noted that the United States government is currently holding about $ 19 billion in cryptocurrencies, mainly in Bitcoin, compared to $ 750 billion in gold.
The vast majority of the government’s assets of convulsions are in Bitcoin, which means that it is likely that the accumulation of other digital assets would be funded by open market purchases, according to the report.
However, “the selection criteria are not currently clear”, and the pre-announcement of such investments can advance prices against an investor, said the bank, adding that this happened to the British government with gold in the late 1990s.
An additional clarity on the selection criteria for which tokens must be included in the reserve would provide more support, said the bank.
Bernstein broker said the federal reserve could issue debt or sell some of its gold reserves to finance cryptocurrency purchases in a report last month.
Read more: Us Crypto Task Force to focus on the delivery of the Bitcoin National Reserve: Bernstein
