The crypto market declined sharply a day after Donald Trump's announcement of a U.S. crypto reserve. We explore the reasons behind this trend.
Brief Rally and Subsequent Decline
The crypto market initially surged after news of Trump's intent to create a national crypto reserve, but this surge quickly faded due to various factors.
Reaction of Major Cryptocurrencies
Bitcoin fell by nearly 10%, Cardano dropped over 20%, experiencing a sharp reversal after significant gains. Solana, Ethereum, and XRP also faced substantial losses despite initial optimism.
Contributing Factors to the Decline
Increasing global trade tensions due to Trump's tariffs, technical factors like the CME futures gap, and investors' shift toward safe-haven assets reversed the market momentum.
Despite the initial boost from the crypto reserve announcement, the crypto market encountered challenges due to geopolitical and technical factors, highlighting the volatility of the crypto market.
