An American crypto strategic reserve appears more likely after President Trump’s announcement this weekend, Wall Street Bank Citi (C) said in a research report Monday.
The president announced that XRP, Solana (Sol) and Cardano (ADA) would be included in a strategic reserve and later added Bitcoin (BTC) and Ether (ETH) to the list of assets.
“The announcement of further plans for the US government, which could potentially become a strategic proprietor of digital assets, would add the perceived legitimacy” of the asset class, analyst Alex Saunders wrote.
Citi noted that the US government currently has about $ 19 billion in cryptocurrencies, mainly in Bitcoin, against $ 750 billion in gold.
The vast majority of government holdings from seizures are in Bitcoin, which means that the accumulation of other digital assets will be funded by open market purchases, the report says.
Still “selection criteria are not at the moment clear,” and pre -recovery of such investments can move prices against an investor, the bank said, adding that this happened to the British government with gold in the late 1990s.
Further clarity on the selection criteria, which tokens must be included in the reserve, would provide more support, the bank said.
Broker Bernstein said the Federal Reserve could issue debt or sell some of its gold reserves to fund cryptocurrency purchases, in a report last month.
Read more: US Crypto Task Force to focus on providing National Bitcoin Reserve: Bernstein
