Trump’s Crypto Reserve Sparks Debate: Should It Be Bitcoin-Only?

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Since the day when US President Donald Trump

Donald Trump

Donald Trump is an American former president politician, businessman, and media personality, who served as the 45th president of the U.S. between 2017 to 2021. Trump earned a Bachelor of science in economics from the University of Pennsylvania in 1968. Trump won the 2016 presidential election as the Republican Party nominee against Democratic Party nominee Hillary Clinton while losing the popular vote. As president, Trump ordered a travel ban on citizens from several Muslim-majority countries, diverted military funding toward building a wall on the U.S.–Mexico border, and implemented a family separation policy. Trump has remained a prominent figure in the Republican Party and is considered a likely candidate for the 2024 presidential election

President

confirmed the plan to establish a cryptocurrency reserve, numerous rumours on how the composition of the proposed reserve would be have been released. Many believe that apart from Bitcoin, the US crypto reserve would include several prominent altcoins, including XRP, Solana, Ethereum, and Cardano. However, some renowned experts like Will Baxter have expressed reservations about the possible inclusion of altcoins in the reserve, appealing aggressively for the creation of a BTC-only reserve. Let’s understand what Baxter has to say! Ready?

Trump Confirms a US Crypto Reserve 

The victory of pro-crypto candidate Donald Trump in the US presidential election reversed the approach of the US administration towards the crypto industry. 

In the initial days of the induction itself, the Trump administration introduced some aggressive policies to support the industry. 

The establishment of a special crypto task force under the US Securities and Exchange Commission to develop a clear crypto regulation framework and the appointment of pro-crypto leaders in key administration positions in the White House were the prominent ones among the policies adopted by the Republican government. Recently, the US government confirmed its plan to establish a crypto reserve. 

Currently, there is no clarity on what would be the composition of the US crypto reserve. Will Baxter, a Vice President at Braiins Mining, has strongly called for the creation of a Bitcoin-only reserve. 

The prime reasons why he believes including altcoins in the crypto reserve would be a huge mistake are given below. 

Bitcoin Is the Only Truly Decentralised Asset 

Baxter has highlighted the truly decentralised nature of Bitcoin. There exists no founding team to control Bitcoin. But most altcoins have centralised foundations or companies. 

Altcoins Has Pre-Mined Supply, Giving Insiders an Edge 

Baxter has emphasised the issues related to pre-mined supply. Bitcoin has no pre-mined supply. Meanwhile, the case of altcoins is different. Almost all the top ten altcoins including ETH have pre-mined supply. Ethereum pre-sold at least 70% of its initial supply.

Importantly, Ripple holds no fewer than 55% of the total supply of XRP, and Solana Foundation, insiders and VCs own 50% of the total supply of SOL.

Censorship Resistance and Security Issues 

The expert has also pointed out the importance of security. Bitcoin is known for its robust mining network. It is considered as highly secure. Are altcoins as secure as BTC? The sensible answer is no. It is not sensible to include a crypto with a questionable security framework to the national reserve of a country – which wants its economic system to be highly resistant to external threats. 

Ethereum’s History Proves It’s Not Immutable 

The expert has explained how a hack exposed the fundamental weakness of the world’s largest altcoin. Ethereum lost approximately $60 million in the DAO hack. Emphasising how Etheruem rolled back its blockchain after the hack, the expert has argued that Ethereum can be altered when convenient. 

Bitcoin’s Real-World Usage vs. Altcoin Speculation 

Baxter has also argued that altcoins see minimal real economic activity compared to Bitcoin. 

Bitcoin is used by millions as a store of value and settles. 

Also Read :   Crypto Market Crash Wipes Out $500B Amid U.S.-China Trade War Tensions   ,

Bitcoin’s Fixed Supply vs. Altcoin Supply Changes 

The expert has brought attention to the issue of supply as well. Bitcoin has a fixed supply of 21 million coins. However, top altcoins, even Ethereum, have changed their supply rules multiple times.

Altcoins Lobbied Their Way Into the Reserve 

Baxter has alleged that altcoins like XRP, Solana, Ethereum and Cardano have lobbied their way into the US crypto reserve. He has explained why it is unfair to include altcoins in the reserve, asking: “we don’t put tech stocks on our national balance sheet. Why would we put their blockchain equivalents there?”