Democrat lawmaker calls on Treasury to abandon Trump’s Bitcoin reserve plans

Rep. Gerald E. Connolly, the Ranking Member of the House Oversight and Government Reform Committee, urged the US Treasury Department to abandon plans to establish a strategic Bitcoin reserve and the digital asset stockpile.

In a letter to Treasury Secretary Scott Bessent, Connolly condemned the effort as fiscally irresponsible and politically motivated. He warned that the initiative would serve no clear public benefit while significantly enriching President Donald Trump and his allies.

Trump’s executive order

Connolly’s concerns stem from Trump’s March 6 executive order establishing the Strategic Bitcoin Reserve and US Digital Asset Stockpile, which builds on a broader January 23 directive, “Strengthening American Leadership in Digital Financial Technology.”

The initiative would position the federal government as a major holder of Bitcoin (BTC), Ethereum (ETH), XRP, Solana (SOL), and Cardano (ADA). Trump has called the move a way to cement US dominance in digital assets.

Connolly noted Trump’s sharp change in stance on crypto, highlighting that he had previously dismissed digital assets as a “scam” during his first term.

However, his administration is now preparing to allocate federal funds to the sector — an approach Connolly criticized as an attempt to manipulate financial markets for political and personal gain.

He argued that the move amounts to picking winners among digital currencies and creating artificial demand for assets that Trump has financial exposure to.

Conflicts of Interest

The Ranking Member outlined several potential conflicts of interest, including Trump’s reported stake in World Liberty Financial, a digital asset firm that aims to function as a crypto-based lending and investment platform.

Connolly warned that government purchases of crypto could directly benefit Trump’s financial holdings, particularly if the administration prioritizes assets that align with his private investments.

He also pointed to Trump’s involvement in the $TRUMP memecoin, which has surged in value based on speculation surrounding his political statements.

He pointed to reports that entities linked to Trump have generated over $100 million in trading fees from the token, raising concerns that the administration’s crypto initiatives could further drive financial speculation tied to the president.

Lack of Congressional oversight

Connolly also criticized the administration for bypassing Congress in its push to create the reserve, arguing that Trump had not sought legislative authorization nor engaged in consultation with lawmakers about the reserve’s potential risks or benefits.

He warned that without congressional oversight, the initiative could become a tool for political influence rather than a legitimate financial strategy.

He also referenced skepticism from financial experts, citing a Federal Reserve official who reportedly described the plan as “the dumbest idea” ever.

Connolly urged the Treasury Department to immediately halt all plans related to the strategic crypto reserve. He requested a full briefing for House Oversight Committee staff by March 27 and sought clarity on the reserve’s legal justification.

He also requested clarity regarding the process for acquiring and managing the assets, the potential impact on crypto markets, and any financial ties between the White House and digital asset firms.

The Treasury Department has not yet responded to Connolly’s request. His letter signals growing opposition from congressional Democrats, who are increasingly scrutinizing Trump’s expanding involvement in the digital asset industry.

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