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The Daily: Trump's crypto reserve plan sparks criticism, bitcoin and ether slide as new tariffs take effect and more

The Daily: Trump's crypto reserve plan sparks criticism, bitcoin and ether slide as new tariffs take effect and more

The BlockThe Block2025/03/03 16:00
By:By James Hunt

Quick Take President Trump’s announcement of a U.S. Crypto Strategic Reserve surprised the industry by including XRP, SOL and ADA alongside BTC and ETH. The market initially surged on the crypto reserve news, but bitcoin subsequently dropped over 10%, and ether plunged more than 15% after Trump’s announcement of new tariffs on imports from Canada, Mexico and China fueled risk-off sentiment.

The Daily: Trump's crypto reserve plan sparks criticism, bitcoin and ether slide as new tariffs take effect and more image 0

The following article is adapted from The Block’s newsletter,  The Daily , which comes out on weekday afternoons.

Happy Tuesday! Turns out it was another Xi-esque candle after all, with Trump's crypto reserve pump now fully erased amid the latest tariff-fueled slump.

In today's newsletter, industry leaders say the proposed U.S. crypto reserve "delegitimizes bitcoin," digital assets slide as Trump's tariffs take effect, Flowdesk raises $52 million in new funding and more.

Meanwhile, with Trump's backing, the Senate is set to vote on overturning a controversial crypto tax rule.

Let's get started.

Trump's crypto reserve plan 'delegitimizes' assets like bitcoin, say critics

President Trump's announcement of a U.S. Crypto Strategic Reserve surprised the industry by including XRP, SOL and ADA alongside BTC and ETH.

  • Experts criticized the inclusion of XRP and ADA in particular, arguing they lack the decentralization and developer activity seen in Bitcoin and Ethereum's ecosystems.
  • "It's not the job of the government to run an ersatz crypto hedge fund," Castle Island Ventures General Partner Nic Carter said. "It's not their job to pick winners and losers."
  • Meanwhile, SPACE ID Business Development Director Harrison Seletsky said their inclusion "delegitimizes" assets like bitcoin.
    Others accused Trump of using the reserve to "pump his own bags," with some calling the move politically motivated rather than market-driven.
  • "It felt very unprofessional — almost a knee-jerk reaction to the crypto market going through a correction and Trump not wanting it to reflect poorly on himself," CoinCorner CEO Danny Scott said. "This could have been a purely political play to maintain support."
  • Many industry leaders argued that a true strategic reserve should focus solely on bitcoin, given its role as the most decentralized and secure store of value.
  • However, some believe the Trump administration's endorsement could accelerate SEC ETF approval and regulatory clarity for XRP, SOL and ADA.

Bitcoin, ether slide as Trump's tariffs take effect

The market initially surged on the crypto reserve news, but bitcoin subsequently dropped over 10%, and ether plunged more than 15% after Trump's announcement of new tariffs on imports from Canada, Mexico and China fueled risk-off sentiment.

  • Analysts also blamed the sell-off on weak macroeconomic data, rising recession fears and typical signs of market exhaustion.
  • The Trump slump sparked more than $1 billion in liquidations across centralized exchanges over the past 24 hours, with some analysts suggesting bitcoin is failing as a safe haven while gold continues to strengthen amid the economic uncertainty.
  • Crypto ETFs also saw outflows, with U.S. spot Bitcoin ETFs losing $74.2 million on Monday and spot Ethereum ETFs extending their eight-day streak of withdrawals with $12.1 million exiting the funds.

Crypto market maker Flowdesk raises $52 million

Flowdesk has raised a $52 million Series B extension in an 80/20 equity-to-debt split, co-founder and global CEO Guilhem Chaumont told The Block, bringing its total Series B funding to $102 million.

  • HV Capital, a European investor, led the equity portion of the extension round, with participation from French private equity firm Eurazeo, Cathay Innovation and ISAI VC. The debt financing came from funds and accounts managed by BlackRock.
  • The fresh capital will support the firm's expansion, including launching a dedicated crypto credit desk, enhancing its trading infrastructure and boosting its regulatory compliance under MiCA.
  • Flowdesk also plans to nearly double its 140-person workforce and open a new office in the UAE as it scales its market-making and liquidity provision services.

Paradigm leads $41 million token round for Across Protocol

Interoperability-focused Across Protocol has raised $41 million in an ACX token sale led by Paradigm, with participation from Bain Capital Crypto, Coinbase Ventures and Multicoin Capital.

  • The protocol specializes in fast, intents-based cross-chain transfers, executing most Layer 2 transactions in under five seconds using the ERC-7683 standard.
  • Across claims to have processed $19 billion in volume to date and recently integrated with Uniswap's in-app bridging to facilitate seamless multi-chain transfers.
  • With the fresh funding in place, Across aims to drive further adoption of ERC-7683 and support Ethereum's rollup-centric strategy by helping to unify fragmented Layer 2 networks.

Bybit CEO says 20% of $1.4 billion theft has 'gone dark' as hackers swap to bitcoin

Bybit CEO Ben Zhou said that 20% of the $1.4 billion stolen in the exchange's record hack has "gone dark," while 77% remains traceable and 3% is frozen.

  • "This and the coming week is critical for fund freezing as the funds will start to clear at exchanges, OTC and P2P," Zhou wrote in an update on X.
  • The hackers, believed to be North Korea's Lazarus Group, have converted 83% of the stolen ether into bitcoin, mostly via THORChain, pushing the protocol's weekly volume to a record $4.7 billion.

In the next 24 hours

  • Eurozone PPI figures are released at 5 a.m. ET on Wednesday. U.S. mortgage data follow at 7 a.m.
  • Bank of England Governor Andrew Bailey will speak at 9:30 a.m.
  • IOTA and Ethena are set for token unlocks.

Never miss a beat with The Block's  daily digest  of the most influential events happening across the digital asset ecosystem.


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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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