Bitcoin rallied over the weekend following President Donald Trump's announcement of a U.S. strategic cryptocurrency reserve, reversing recent losses and driving the largest digital asset back above $93,000. The move, which signals a shift in federal crypto policy, also boosted other major digital assets, with Ether, XRP, Solana's SOL, and Cardano's ADA posting double-digit gains.
Bitcoin surged as much as 18% from its Friday low of $78,226, briefly touching $95,000 before settling above $93,000, according to Coin Metrics. Ether gained 13%, trading near $2,300. Shares of cryptocurrency-related companies also reacted positively, with Coinbase and Robinhood jumping 9% and 7%, respectively, in premarket trading, while MicroStrategy climbed 12%.
Trump's announcement detailed the creation of a U.S. strategic crypto reserve, a shift from his earlier proposal for a bitcoin stockpile. The reserve will reportedly include multiple digital assets, expanding beyond bitcoin to include Ether, XRP, Solana's SOL, and Cardano's ADA. The announcement, which lacked specific details on how the reserve would be managed, nonetheless fueled optimism in the market.
"The weekend news is exactly the type of catalyst investors have been looking for to feel reassured about follow-through from the U.S. administration with respect to its crypto-friendly policies," Joel Kruger, market strategist at LMAX Group, told CNBC. "Now that we've already seen a healthy correction in February, this sets the stage for the start to the next leg higher for crypto assets."
The sudden spike in prices led to a wave of liquidations among traders who had bet against the market. According to data from Coinglass, bearish positions lost nearly $600 million on Sunday alone, as traders were caught off-guard by the rally. Bitcoin-tracked futures saw over $344 million in liquidations, while Ethereum futures suffered $170 million in losses.
Altcoins also saw aggressive moves. Cardano's ADA skyrocketed 60% in a single day, while XRP and Solana's SOL surged 25%. Futures tracking these tokens registered over $70 million in liquidations each, their highest levels since September 2024, according to Coinglass.
Sunday's rally was amplified by relatively low liquidity, a common characteristic of weekend trading that can lead to exaggerated price swings. The sudden liquidation of short positions, combined with renewed investor optimism, sent prices higher in a short period.
Investors are now closely watching for further details on Trump's crypto reserve initiative. White House AI and crypto czar David Sacks hinted on X that more information would be disclosed at the first White House Crypto Summit, scheduled for Friday. Market participants are expecting the summit to provide clarity on the federal government's role in managing digital assets and how it intends to regulate the broader crypto industry.
Despite the surge, traders remain cautious about the sustainability of the rally. Some analysts had previously anticipated bitcoin to fall toward $70,000 due to macroeconomic headwinds, including U.S. tariffs and a strengthening dollar. However, Trump's announcement has revived bullish sentiment, with traders once again speculating on a potential move toward the $100,000 level.
Open interest, which measures the total number of unsettled futures contracts, has risen by as much as 40% for XRP, ADA, and SOL, indicating that traders expect continued volatility in the market. While some see the rally as a temporary reaction, others believe that the shift in U.S. policy could provide long-term support for the industry.
