- Hougan warns future administrations may liquidate holdings but believes institutional adoption will secure Bitcoin’s long-term role.
- The reserve’s structure remains undefined, with analysts eyeing global adoption impacts and parallels to past policy shifts like tariffs.
The Trump administration’s proposed “Crypto Strategic Reserve” has ignited discussions about its potential focus on Bitcoin, despite initial reports suggesting inclusion of other digital assets. Bitwise Chief Investment Officer Matt Hougan asserted in a March 5 research note that Bitcoin will likely dominate the reserve, even as critics question its multi-asset framework.
Bitwise CEO’s Bitcoin-Centric Outlook
Hougan acknowledged market skepticism toward the reserve’s inclusion of smaller cryptocurrencies, stating, “The final reserve will be nearly entirely Bitcoin, and it will be larger than people think.” He compared the proposal’s evolution to past policy shifts, such as tariff adjustments, suggesting initial drafts often undergo revisions.
Coinbase CEO Brian Armstrong and others have publicly questioned the reserve’s broad asset selection. Hougan countered that international observers, rather than U.S. traders, would drive long-term demand if the policy solidifies Bitcoin’s strategic status.
Excited to learn more. Still forming an opinion on asset allocation, but my current thinking is:
1. Just Bitcoin would probably be the best option – simplest, and clear story as successor to gold
2. If folks wanted more variety, you could do a market cap weighted index of crypto… https://t.co/jv8Gcn8N2S— Brian Armstrong (@brian_armstrong) March 3, 2025
Hougan noted risks tied to potential policy reversals under future administrations, particularly if a Democratic successor liquidates holdings. However, he argued institutional adoption and government recognition could cement Bitcoin’s role regardless of political changes.
Saw the Trump statement today, same as everyone else —
I imagined a Strategic Reserve would be just Bitcoin. That makes the most sense to me.
Many crypto assets have merits, but what we're talking about here isn't a US investment portfolio — we're talking about a reserve, and… https://t.co/YwLBBCt55y
— Hunter Horsley (@HHorsley) March 3, 2025
Bitcoin’s price rose 4.78% to $91,677.50 following Hougan’s comments, with the overall crypto market gaining 4.63% to $3.01 trillion. Despite this, Polymarket data shows only 24% of traders expect Trump to establish the reserve within his first 100 days.
Hougan emphasized that labeling crypto assets as “strategic” would signal U.S. commitment, potentially influencing global adoption. The reserve’s structure remains undefined, though Hougan anticipates a Bitcoin-heavy allocation to minimize volatility and regulatory hurdles.
The proposal’s fate hinges on legislative support and post-election priorities. ETHNews analysts caution that delays or diluted versions could temper market optimism, while a clear Bitcoin focus might bolster institutional participation.
