TL;DR

  • Warren requests confirmation from agencies that no public money will back Bitcoin.
  • Bitcoin’s value has dropped approximately 50% from its October high.
  • World Liberty Financial offloaded wrapped Bitcoin to prevent being liquidated.
  • Warren cautions that rescue packages might primarily aid affluent investors and insiders.

U.S. Senator Elizabeth Warren has called on the Treasury Department and the Federal Reserve to affirm that public funds will not be utilized to bolster Bitcoin or help cryptocurrency companies amid the continuing market slump. Her correspondence was dispatched as Bitcoin keeps declining from its previous peak, reigniting discussions about the state’s involvement in digital asset markets.

The steep drop and numerous forced closures of positions have prompted fresh inquiries into the federal government’s power to step in. Warren stated that both bodies must eliminate any measures that might pass losses from cryptocurrency investors onto taxpayers. Bitcoin has shed close to half its worth since October, and leveraged bets have intensified market strain.

This appeal occurs as cryptocurrency operations expand across the United States. Following President Donald Trump’s return to the White House, certain states have weighed creating strategic Bitcoin stockpiles, and Congress has deliberated new regulations for digital assets. Federal bodies have also progressed multiple initiatives aimed at incorporating digital assets into the wider financial framework.

Warren Warns Against Use of Public Funds

Elizabeth Warren argued that government action during the present downturn would disproportionately help wealthy investors and major stakeholders. She wrote that a financial rescue “would be widely opposed” and indicated it could assist those holding significant amounts of Bitcoin. She further stated it could profit President Trump and his family because of their ties to a cryptocurrency company.

The senator highlighted recent moves by World Liberty Financial. The firm sold approximately 173 wrapped Bitcoin to settle $11.75 million in USDC debt. Warren explained the company acted to evade liquidation once Bitcoin dropped under $63,000. She mentioned that other substantial Bitcoin holders have also incurred losses during the slump.

Warren expressed uncertainty over whether any federal body intends to step into the market. Her letter noted testimony from Treasury Secretary Scott Bessent, who was questioned on the potential use of taxpayer funds for digital assets. Warren said his answer lacked a definitive dismissal of the possibility.

Market Conditions and Investor Losses

Bitcoin is currently valued just below $67,000, based on market figures. Predictive markets indicate a firm anticipation of additional declines toward $55,000. The fall has impacted institutional holders and retail investors who increased their holdings during the market’s ascent.

Elizabeth Warren identified several notable individuals who have acknowledged losses. She mentioned Strategy Inc., the company linked to , which has experienced a falling stock price. She also alluded to losses disclosed by Binance founder Changpeng Zhao and Coinbase CEO Brian Armstrong. Warren contended this sell-off underscores the necessity for enhanced consumer safeguards.

She observed that 2025 saw a historic level of reported cryptocurrency fraud, totaling $17 billion in losses or theft. Warren stated that in the absence of explicit regulations, everyday investors could end up absorbing losses while large companies shield themselves from danger.

Federal Responses and Regulatory Positions

Government representatives have recently fielded questions about state authority. At a House Financial Services Committee session, Bessent confirmed the Treasury holds confiscated Bitcoin. He also affirmed the government lacks the legal power to prop up the Bitcoin market using public money. He further noted no process exists for agencies to order banks to purchase Bitcoin.

A Federal Reserve spokesperson confirmed receipt of Warren’s letter and indicated a response is forthcoming. The Treasury Department has not provided an immediate comment.

The letter was delivered the same day World Liberty Financial hosted a business forum at Trump’s Mar-a-Lago resort. The gathering attracted notice because of the firm’s position in the digital asset industry and its connections to the president.

Elizabeth Warren urged federal agencies to enhance safeguards for everyday investors and increase scrutiny of leveraged cryptocurrency holdings. She added that regulators must guarantee the market does not transfer risk to ordinary households or retirement savings.