- The Australian government has said it will not be considering establishing a strategic crypto reserve following Donald Trump’s announcement that the US will be creating a reserve of several cryptocurrencies including BTC, ETH and XRP.
- Australia will continue to pursue what the government refers to as ‘fit-for-purpose’ regulation of the digital assets industry.
- Trump’s announcement initially saw crypto prices explode, but there has since been a significant correction.
Following yesterday’s announcement that the US is moving ahead with plans to establish a strategic crypto reserve, the Australian government has confirmed it does not currently plan to go full degen.
Speaking to Sky News, a spokesperson for the Assistant Treasurer and Financial Services Minister, Stephen Jones, indicated the Australian Government remains focussed on regulatory reform for the digital assets sector and has no plans to start investing public money in crypto in the near term.
The Albanese government has consulted on our proposed framework to build a fit-for-purpose digital asset regulatory regime, and we continue to work closely with industry. The Albanese government knows that blockchain and digital assets present big opportunities for our economy, our financial sector and innovation.
Australian Government Spokesperson
President Trump announced his plans for a strategic crypto reserve on his Truth Social social media platform, saying it will include XRP, ADA and SOL in addition to the two largest cryptocurrencies by market cap, BTC and ETH. This announcement sent crypto prices soaring — at one stage ADA was up almost 70% on the day and many other coins saw double-digit pumps.
However, that exuberance now seems to have turned to doubt with most cryptocurrencies tumbling ‘bigly’ today. At the time of writing, data from CoinGecko shows BTC is down over 8%, XRP is down close to 18% and yesterday’s biggest gainer ADA is down a whopping 23%.
Related: XRP, ADA Skyrocket as Trump Says Strategic Reserve to Include Bitcoin, Ether, Solana, XRP and Cardano
Australian Government Not Quite Ready To FOMO
The Australian government’s steady-as-she-goes response to Sky on the potential for a reserve is consistent with the stance it has taken on digital assets throughout its term. It has consistently claimed its focus is on establishing ‘fit-for-purpose’ regulation and working with agencies like AUSTRAC and ASIC to target dodgy players in the industry.
Despite this alleged focus though, the government has also faced criticism for deliberately slow-walking progress on crypto regulation.
In his announcement of the crypto reserve, Trump described crypto as a “critical industry”, saying the crypto reserve would counter the years of attacks the industry faced under the Biden administration:
A U.S. Crypto Reserve will elevate this critical industry after years of corrupt attacks by the Biden Administration.
Donald Trump, US PresidentTrump also claimed he “will make sure the U.S. is the Crypto Capital of the World”, echoing promises he made during the election campaign.
Crypto Reserve Met with Skepticism
Despite the immediate pump the crypto reserve announcement triggered, many figures within the industry reacted with skepticism. Conflict of interest concerns were also raised given that David Sacks has a stake in Bitwise Asset Management — through his venture firm — which runs a large crypto index fund with top holdings including Bitcoin, Ethereum, Solana, XRP and Cardano.
Posting on X / Twitter Coinbase CEO, Brian Armstrong, said the best option for the reserve would be to make it Bitcoin only:
Just Bitcoin would probably be the best option – simplest, and clear story as successor to gold.
Brian Armstrong, Coinbase CEOCTO of Australian crypto exchange Elbaite, Samira Tollo, said Trump’s motives for including ADA are questionable, as it represents just 1% of market share. “It’s clear from this announcement that his incentives lie elsewhere. All while creating mass “Hopium”,” she posted to LinkedIn.
She also pointed to the many questions that remain about how it would work including:
- What proportions will each coin represent in the reserve?
- Will this reserve be actively managed or passively held?
- When will this reserve be launched?
Joe Lonsdale, the founder of AI-based data analytics firm Palantir essentially called the scheme a grift and protested that his tax dollars shouldn’t be used for buying crypto. “Taxation is theft. It should be kept to a minimum. It’s wrong to steal my money for grift on the left; it’s also wrong to tax me for crypto bro schemes,” he said.
Meanwhile Jason Calacanis, co-host of crypto tsar David Sacks’ “All-In” podcast, went further still, calling the strategic reserve an “insane grift” and claiming that 99% of Trump supporters hate the idea but are too scared to say anything for fear of angering the President.
Related: President Trump to Host Landmark White House Crypto Summit on March 7
Given the political backlash Trump’s announcement has caused and the huge dump currently underway in the crypto markets it seems like the Australian government is wise to take a more cautious approach to digital assets for now.
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