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Why did Trump add Cardano to the U.S. cryptocurrency reserves?
The decision of US President Donald Trump to include Cardano's ADA native cryptocurrency in his 'strategic cryptocurrency reserve' has shocked the blockchain community and made significant strides. The value of ADA has increased by more than 70% in less than 24 hours as investors rush to buy into this newly crowned national cryptocurrency asset, while the total trading volume of this coin has surged, increasing by 1.807% in the same time frame The plan to create a cryptocurrency reserve fund by Trump aims to achieve his stated goal of elevating this "important industry" in the United States. By creating a national reserve containing BTC, ETH, XRP, SOL, and ADA, he will "ensure the U.S. is the capital of the cryptocurrency world". This is a significant reversal signaling the US government's stance on cryptocurrencies, after years of close scrutiny by regulatory agencies under Trump's predecessor Joe Biden. Currently, the US intends to integrate top digital assets into the country's financial infrastructure, in a move that could make cryptocurrencies an indispensable part of the nation's economy. Why Cardano? Adding Bitcoin, the oldest and most valuable cryptocurrency in the world, and Ethereum, the most popular smart contract blockchain, to the list does not surprise anyone. Adding Solana to the list, as the closest competitor to Ethereum, is also understandable, while the attraction of XRP to some of the world's largest banks, which use XRP as a fast, low-cost cross-border payment tool, justifies its inclusion in the list. But what about Cardano? Why is it also on the list? Fast and energy efficient Although Cardano may be less well-known than the other four currencies on the list, there are still some compelling reasons why holding ADA makes sense. Known for its peer-reviewed approach to blockchain research, Cardano is building a scalable and sustainable blockchain platform capable of supporting real-world applications in industries such as finance, identity management, governance, and Central Bank Digital Currency (CBDC). The interesting thing about Cardano is its novel architecture. Its blockchain is based on a unique two-layer architecture supported by a proof-of-stake consensus mechanism to facilitate fast, low-cost transactions. Furthermore, it integrates an extended UTxO model, bringing remarkable energy efficiency compared to proof-of-work blockchains like Ethereum. Cardano's founder, Charles Hoskinson, responded in an interview with Forbes in 2021 that this network saves energy more than Bitcoin up to 1.6 million times Another important advantage of Cardano is its academically peer-reviewed approach. Unlike other projects, the project's developers and engineers work closely with scholars to produce in-depth research guiding future development processes. This, along with the fact that the project is entirely open-source, will ensure the longevity and sustainability of Cardano beyond its parent organization. Furthermore, Cardano's decentralized constitution lays the foundation for a governance model that ensures responsible and open decision-making. With the recent Plomin hard fork, ADA holders can actively participate in protocol governance. Interactivity and Compliance In addition to the benefits mentioned above, Cardano's innovative architecture also helps address urgent challenges regarding the interoperability of the blockchain industry and issues surrounding the fragmentation of liquidity arising from these challenges. Cardano itself is a multi-asset chain capable of supporting various types of digital assets, including those on other blockchains. This is also where projects focusing on interaction capabilities like Apex Fusion play a crucial role in connecting Cardano to the world's largest blockchain ecosystem, Ethereum. Co-founded by former Cardano and Ethereum veterans, the Apex Fusion network integrates with both Ethereum's UTxO and EVM models, ensuring seamless asset transfers via the Reactor Bridge. Through this innovation, it can help Cardano play a crucial role in facilitating liquidity across cryptocurrency ecosystems. Apex Fusion also supports Cardano on its journey to become the most compliant blockchain today. With Trump's strategic cryptocurrency reserves likely to encourage more traditional financial institutions to explore digital assets, blockchain will need to integrate compliance with fiat. Apex Fusion's FINMA status ensures that its cross-chain interaction mechanisms comply with legal requirements by design, ensuring that Cardano itself becomes more attractive from a management perspective. USA First Another reason Cardano may have been added to the list could be political. Trump did not hide his "America first" approach to supporting the cryptocurrency industry, just like in every other way. When he announced reserves, he framed it as a move to promote the US cryptocurrency industry, therefore, treating US projects favorably is reasonable. Trump said that when he appeared at a Bitcoin conference last year during his election campaign, where he declared, "if cryptocurrency shapes the future, I want it to be mined, minted, and produced in the United States." If so, then Cardano fits the bill as one of the most prominent domestic cryptocurrency projects in the United States, founded by a US citizen Hoskinson. The idea is that by promoting cryptocurrency projects based in the US, the government will encourage local investment in these companies and create more jobs for American developers and blockchain engineers. Trump's decision is clear Platforms like X, Reddit, Discord, and Telegram continue to debate whether Cardano deserves a place in the US strategic cryptocurrency reserve. But regardless of its pros and cons, Trump himself has decided that Cardano and ADA deserve to be included in the list, and like most things related to his administration, his word is often final. This is a surprising move for some, but those who believe in Cardano and its ecosystem will be happy with this prospect, which will surely add new momentum to one of the most successful and promising cryptocurrency projects today.