U.S. Senator Elizabeth Warren, a Democrat from Massachusetts, called on the Treasury Department and the Federal Reserve to confirm that they will not use taxpayer funds to support cryptocurrency investors or firms.
In a letter sent Wednesday to Treasury Secretary Scott Bessent and Federal Reserve Chair Jerome Powell, Warren warned that any government intervention could transfer wealth from taxpayers to wealthy crypto investors.
“Your agencies must refrain from propping up Bitcoin and transferring wealth from taxpayers to crypto billionaires through direct purchases, guarantees, or liquidity facilities,” Warren wrote.
She argued that a bailout would disproportionately benefit the wealthiest players in the cryptocurrency market and could directly enrich President Donald Trump through his family’s company, World Liberty Financial.
Warren’s letter comes as Bitcoin has declined roughly 50% since reaching a peak in October. She said the sell-off has been worsened by cascading liquidations of leveraged positions, affecting both corporate and individual investors.
The Massachusetts senator noted that World Liberty Financial recently sold about 173 wrapped Bitcoin to repay $11.75 million in USDC stablecoin debt, avoiding liquidation as Bitcoin fell below $63,000.
Warren: Crypto and bitcoin retail is at risk
The letter cited losses among major crypto investors. Michael Saylor’s Strategy Inc., a leading corporate holder of Bitcoin, has seen its shares fall nearly 20% since the start of the year. Binance founder Changpeng Zhao reportedly lost close to $30 billion, and Coinbase CEO Brian Armstrong reportedly lost $7 billion, Warren claimed.
Warren also highlighted the risks to retail investors. In 2025, U.S. investors lost or had stolen a record $17 billion in cryptocurrency fraud, according to her letter.
She urged federal financial agencies to strengthen protections for individual crypto users, citing the growing scale and complexity of digital asset markets.
The letter referenced a February 6 House Financial Services Committee hearing, where Rep. Brad Sherman asked Secretary Bessent whether taxpayer money could be deployed into crypto assets. Bessent did not answer directly but stated that the Treasury was “retaining seized Bitcoin.” Warren described this response as a deflection and said it left unclear whether the government has any plans to intervene in the Bitcoin sell-off.
Warren reminded the Treasury and the Fed that both agencies have broad authorities to provide financial support to banks and other entities during financial crises. She argued that these tools should not be used to stabilize Bitcoin or other digital assets, which she described as high-risk investments primarily benefiting wealthy investors.
The Fed confirmed receipt of Warren’s letter and said it plans to respond. The Treasury Department did not immediately comment.
Bitcoin was trading just under $67,000 Wednesday, according to Bitcoin Magazine data.