Donald Trump’s announcement of a ‘Crypto Strategic Reserve’ containing some prominent altcoins sparked a major (albeit extremely temporary) token price rally, as well as cries that America’s crypto corruption seems to have found another gear.

On the morning of Sunday, March 2, President Trump posted the following message from his Truth Social account: “A U.S. Crypto Reserve will elevate this critical industry after years of corrupt attacks by the Biden Administration, which is why my Executive Order on Digital Assets directed the Presidential Working Group to move forward on a Crypto Strategic Reserve that includes XRP, SOL, and ADA.”

Two hours later, Trump posted a follow-up message: “And, obviously, BTC and ETH, as other valuable Cryptocurrencies, will be the heart of the Reserve. I also love Bitcoin and Ethereum!”

Reaction to Trump’s initial message was decidedly mixed, particularly among BTC maximalists, who’ve been badgering Trump to launch a ‘Strategic Bitcoin Reserve’ for a while now. Trump’s initial message regarding the trio of altcoins (aka shitcoins) alarmed many, even as it sent the fiat prices of those utility-free tokens rocketing upward.

Trump’s second post performed similar magic on BTC/ETH prices, which had suffered a weeklong decline not seen since the late 2022 collapse of the FTX exchange. BTC, which had fallen below US$79,000 on February 28, soared to nearly $95,000, while ETH rose from $2,100 to $2,540 over the same span.

But by Monday evening, BTC had fallen below $84,000 while ETH slipped below $2,100. That’s still better than both were prior to Trump’s announcements, but it appears that the post-comments hangover is offering a moment of clarity regarding the lack of real substance in Trump’s posts.

For one thing, with the exception of naming specific tokens, the announcements weren’t much more than a restating of Trump’s executive order of January 23. That order offered a similarly vague pledge that his new President’s Working Group on Digital Assets (aka ‘crypto council’) would “evaluate the potential creation and maintenance of a national digital asset stockpile and propose criteria for establishing such a stockpile.”

Trump also lacks the authority to act alone on any token purchasing plan—which is vastly different from simply prohibiting the sale of tokens the government has seized over the years as the proceeds of crime. While lacking explicit authority to act hasn’t deterred Trump before, a move of this significance could result in both pushback from Congress and legal challenges from taxpayer groups.

Indeed, Trump’s comments came two days after Sen. Cynthia Lummis (R-WY)—the most vocal proponent of America using taxpayer funds to buy up to 1 million BTC tokens for the ‘strategic reserve’—poured cold water on the idea that the federal government will open its wallet anytime soon.

Speaking at last week’s Bitcoin Investor Week conference in New York, Lummis said reserve backers “don’t have enough people comfortable enough in the House and Senate to do this yet.” Lummis suggested that “you’ll see a state have a Bitcoin strategic reserve before the federal government.” Perhaps, but the number of U.S. states that are backing away from establishing their own reserves is growing.

Sacks denies personally profiting

Trump’s plans may become a little more clear following the ‘crypto summit’ at the White House on Friday, March 7. Trump himself will “host and deliver remarks” at the meeting, the first of its kind, which will feature “prominent founders, CEOs, and investors from the crypto industry.” The names of these invited guests have yet to be disclosed.

Also in attendance will be Working Group members, which include a few Cabinet members, although it’s unclear which of these might attend. The summit will be chaired by Trump’s new A.I. & Crypto Czar, David Sacks, and ‘administered’ by its exec director, Bo Hines.

Speaking of Sacks, he pushed back Monday against some of the more libertarian-minded members of ‘Crypto Twitter’ who expressed outrage at the prospect of being taxed to pay for “crypto bro schemes.” Sacks said “[n]obody announced a tax or a spending program. Maybe you should wait to find out what’s actually being proposed.”

Sacks defended not only the administration’s plans but also his own role in those plans, following allegations that he stood to personally profit from the reserve’s inclusion of tokens that, until Sunday, no one in history had referred to as ‘strategic.’

Responding to a Financial Times report that said he and his Craft Ventures investment firm “sold their direct cryptocurrency holdings soon after Trump’s inauguration,” Sacks tweeted that he’d personally sold “all my cryptocurrency (including BTC, ETH, and SOL) prior to the start of the administration.”

However, that tweet got ‘community noted’ due to Craft Ventures being an investor in Bitwise Asset Management, which lists its top-five token holdings as the same five tokens Trump mentioned on Sunday.

Sacks replied that the note “is a lie” because he “had a $74k position in the Bitwise [exchange-traded fund] which I sold on January 22. I do not have ‘large indirect holdings.’” Sacks promised further updates following the conclusion of a government ethics review (although Trump fired the director of the Office of Government Ethics nearly a month ago).

Sacks was an early SOL whale via his involvement in Multicoin Capital and appeared to joke about dumping his SOL bags on retail investors during a 2021 episode of the All-In podcast he co-hosts.

Sacks also previously spoke out against the government acting “as a capital allocator” because “the money goes to special interests who have the ability to lobby but not to innovate, and it has to come from somewhere.” To no one’s surprise, that 2021 tweet is getting a lot of airtime in 2025.

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Well, somebody’s insider trading

Following Trump’s proclamations, his son, Eric, tweeted his appreciation of “the genius of announcing a strategic reserve on a Sunday, when traditional markets are closed and Wall Street sleeps.”

Not everyone was sleeping, as sharp-eyed blockchain sleuths spotted an unidentified derivatives trader who, shortly before Trump’s reserve announcements, placed multi-million-dollar bets that BTC and ETH would rocket in value. These bets ultimately netted the unknown Nostradamus a $6.8 million profit.

Lookonchain reported that a trader had deposited $6 million worth of Circle’s USDC stablecoin into the Hyperliquid decentralized exchange, then placed 50x leveraged bets that the prices of BTC and ETH would moon. Lo and behold, the tokens did indeed moon following Trump’s posts and the trader closed out most of his long positions the same day for a seven-figure profit.

As many observers were quick to comment, the near-perfect timing of these bets suggested they were placed either by the world’s foremost psychic “or an insider that knew something.” The fact that the 50x leverage meant a mere 2% decline in the price of either token would have liquidated the unknown trader also strongly suggests the fix was in.

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SEC releases the Kraken (and Yuga Labs)

Monday brought word that the U.S. Securities and Exchange Commission (SEC) was dropping yet another complaint against a crypto firm. This time, it was the Kraken digital asset exchange, which the SEC accused of operating an unregistered securities exchange, broker, dealer, and clearing agency way back in November 2023.

The SEC has definitely turned over a new leaf vis-à-vis crypto litigation, having in recent weeks dropped or paused proceedings against (deep breath) Binance, Coinbase (NASDAQ: COIN), Gemini, Robinhood (NASDAQ: HOOD), and Uniswap. Even Justin Sun and his Tron blockchain have been given a second chance to at least pretend to care about compliance (although America’s regulatory bodies aren’t really sure what companies need to comply with anymore).

Crypto bros are understandably cheering the developments, but other observers are experiencing very different emotions. Former SEC enforcement director John Reed Stark told Bloomberg that the SEC’s about-face represents “a multifaceted demolition of the most successful SEC enforcement program in history … that’s not just unprecedented and unusual, it’s beyond imagination.”

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Hex’s Heart catches a break

While the SEC insists crypto fraud remains illegal, its best chance at demonstrating that lingering commitment got torpedoed last week. On February 28, a U.S. federal court dismissed fraud charges the SEC filed against HEX founder Richard Heart aka Richard Schueler, citing “lack of personal jurisdiction and for failure to state a claim.”

U.S. District Judge Carol Bagley Amon of the Eastern District of New York ruled that the SEC failed to establish that Heart—last seen hiding out in Finland—had ‘substantial’ contact with the U.S. and U.S.-based ‘investors’ to warrant the SEC’s oversight. While Amon left the door open for the SEC to file an amended complaint, the new-look SEC likely has no interest in doing so.

Heart was positively giddy at his victory, saying it “brings welcome relief and opportunity to all cryptocurrencies.” Heart is tweeting from parts unknown, as he remains wanted by both Finnish authorities and global crime fighters Interpol for aggravated tax fraud and the violent assault of a 16-year-old, who was left “covered in blood” following Heart’s blows.

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Coinbase not done tormenting the SEC

When Gemini co-founder Cameron Winklevoss announced the end of his company’s fight with the SEC, he sounded almost annoyed it was over. Cameron demanded “a real, public reckoning” from the SEC, including a 3x refund of legal fees, the public sacking of any SEC staff involved in crypto complaints, a prohibition on these individuals ever getting another federal government job and Mark Zuckerberg’s head on a pike. (Sorry, wrong file.)

Also in the sore winner category is Coinbase, whose chief legal officer Paul Grewal announced Monday that the company has filed a freedom of information (FOI) access request “asking the SEC to explain how much its war on crypto cost taxpayers.”

Grewal says the point of this document diving is to learn “how many investigations and enforcement actions were brought,” “how many employees worked on these investigations/enforcement actions,” “how many third-party contractors were used in these investigations/enforcement actions,” as well as the budget of the SEC’s Crypto Assets and Cyber Unit.

Grewal said the beating of this dead horse demonstrates that Coinbase will “never stop fighting for government transparency on behalf of our customers and this industry.” We’re pretty sure customers care infinitely more about (a) Coinbase’s creaky infrastructure not crashing every time more than five people try to access the site, and (b) not having to publicly shame CEO Brian Armstrong in order to get Coinbase to lift the seemingly arbitrary freezes it places on their accounts.

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SEC Task Force gets busy

The SEC’s recently established Crypto Task Force continue to take meetings with interested parties, including ‘transaction risk management platform’ Notabene, and Wall Street asset managers Franklin Templeton. The latter has been one of the more aggressive firms in terms of launching crypto-based ETFs and applying for new ones for other tokens.

On March 3, SEC commissioner Hester Peirce announced the members of the Crypto Task Force staff, including longtime SEC employee Richard Gabbert as chief of staff of the 14-strong roster (not counting Task Force chair Peirce). Former Wilkie Farr & Gallagher partner Michael Selig will serve as chief counsel, while the role of chief policy adviser will be filled by Taylor Asher, who previously advised SEC acting chair Mark Uyeda.

The Task Force will hold its inaugural ‘roundtable’ on March 21 at the SEC’s headquarters in Washington, D.C.. The event will be open to the public and streamed live via SEC.gov. Details of the agenda and names of roundtable speakers will be released “in the coming days.”

The first meeting is titled ‘How We Got Here and How We Get Out—Defining Security Status’ and is part of a series of meetings dubbed the ‘Spring Sprint Toward Crypto Clarity.’ (Artfully alliterated, ain’t it?) In addition to the primary table talk, there will be ‘small group breakout sessions’ that won’t be streamed online.

Meanwhile, the SEC is reportedly offering staff members $50,000 to quit by April 4, according to a new Reuters report. The financial incentive, which must be applied for by March 21, is reportedly part of the across-the-board cost-cutting initiatives of Elon Musk’s Department of Government Efficiency (DOGE).

The SEC, which last week informed 10 regional office directors that their jobs were being eliminated, also informed staff that it is terminating the leases on its Los Angeles and Philadelphia offices. Also, unionized SEC staff who’ve been working remotely have been told they must return to the office by April 14, hopefully not in Los Angeles or Philadelphia; otherwise, they’re in for a really long commute.

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Congressional Crypto Avengers, assemble!

Finally, with Congress determined to approve legislation governing both stablecoins and an overall regulatory market structure for digital assets in the current session, members from both sides of the aisle are forming a new Congressional Crypto Caucus (CCC).

The CCC is the result of a bipartisan team-up between Representatives Tom Emmer (R-MN) and Ritchie Torres (D-NY), both recognized supporters of all things crypto. Emmer’s office released a statement saying the CCC “will serve as a unified nonpartisan voting block [sic] in Congress, ready to mobilize to support and defend open, permissionless, and private innovation in the United States.”

Emmer tweeted that he and Torres were looking to “capitalize on” the fact that “millions of American voters” had “elected the most pro-crypto Congress and Presidential Administration in history.” Torres tweeted his hopes that the CCC will “build a unified, bipartisan coalition to cement America’s leadership in the future of digital assets and blockchain innovation.”

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Watch: Teranode is the digital backbone of Bitcoin

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