Last updated on March 15th, 2025 at 08:45 am
A Democratic lawmaker is calling on the U.S. Treasury to abandon plans for a strategic cryptocurrency reserve, citing potential conflicts of interest involving President Donald Trump and arguing that such a move offers no tangible benefits to the American people.
In a letter dated March 13, House Representative Gerald E. Connolly of Michigan urged Treasury Secretary Scott Bessent to “cease all attempts” to establish the reserve, warning that it would disproportionately benefit Trump and his donors rather than serve any national interest. Connolly also raised concerns over the lack of congressional authorization for the initiative.
The lawmaker took particular issue with what he described as the administration’s selective favouritism toward certain cryptocurrencies, arguing that decisions influenced by social media trends rather than sound economic policy could prove fiscally irresponsible. He also pointed to remarks from an official of the Federal Reserve, which reportedly dismissed the plan as “the dumbest idea ever.”
“A digital currency reserve would constitute nothing more than a highly speculative taxpayer-backed hedge to “provide bitcoin speculators the assurance that when the crash comes, the State will deploy this fund to rescue it,”
Connolly wrote.
Trump’s executive order called for establishing two crypto initiatives: the proposed Digital Asset Stockpile, which would exclusively contain cryptocurrencies already forfeited to the government, and the Strategic Bitcoin Reserve, designed to function with budget-neutral strategies, ensuring no financial burden on taxpayers.
However, the Michigan lawmaker has demanded transparency from the Treasury, requesting documents and communications related to the Bitcoin reserve’s formation, along with a list of steps to mitigate conflicts of interest. He also inquired about the involvement of administration officials—including Elon Musk—in shaping the cryptocurrency reserve’s regulatory framework.
Beyond the policy concerns, Connolly highlighted potential ethical conflicts, alleging that Trump’s financial interests in the crypto sector could influence decision-making. He specifically pointed to Trump’s involvement with the cryptocurrency platform World Liberty Financial and the Official Trump (TRUMP) memecoin, which has reportedly generated over $100 million in trading fees.
Connolly’s criticism aligns with earlier remarks from Representative Maxine Waters, another Democrat on the House Financial Services Committee, who previously condemned the TRUMP token as emblematic of “the worst of crypto” and accused its backers of orchestrating a “rug pull.”
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