- U.S. Senator Elizabeth Warren has asked the Treasury and Fed to confirm they would not engage in “propping up” crypto firms or investors.
- Bitcoin has fallen roughly 50% from its October high.
- Treasury Secretary Scott Bessent said the government lacks authority to support Bitcoin with public funds.
U.S. Senator Elizabeth Warren urged federal agencies on Wednesday to publicly confirm they will not use taxpayer money to support Bitcoin or bail out cryptocurrency firms amid a sharp market downturn. Her letter to Treasury Secretary Scott Bessent and Federal Reserve Chair Jerome Powell argued against transferring wealth from taxpayers to “crypto billionaires” through government purchases or financial facilities, according to a CNBC report.
Warren’s demand comes as Bitcoin trades near $67,000, representing a precipitous 50% drop from its peak last October. This steep decline has reportedly triggered cascading liquidations of leveraged positions, rattling major investors and companies with significant exposure to the digital asset. Consequently, the senator expressed concern that it remains “deeply unclear” what plans, if any, the government has to intervene in the current selloff.
The Treasury secretary has already pushed back against such speculation, stating at a February 4 House Financial Services Committee hearing that the government lacks the legal authority to support or bail out Bitcoin using public funds. He confirmed the Treasury is “retaining seized Bitcoin” but indicated there is no mechanism to direct banks to purchase it or to deploy taxpayer money to stabilize the market.
Meanwhile, Warren pointed to recent market activity, citing World Liberty Financial‘s sale of roughly 173 wrapped Bitcoin to repay $11.75 million in stablecoin debt and avoid liquidation as prices fell. She maintains this volatility underscores the need for “ordinary, commonsense consumer protections” in the industry, a point she reiterated in a February 9 statement.
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