In a pointed critique of President Donald Trump's recent financial policy, Representative Gerald E. Connolly has urged the U.S. Treasury Department to cease its plans to establish a strategic cryptocurrency reserve.
Representative Gerald E. Connolly has penned a pointed critique of President Donald Trump's recent financial policy, urging the U.S. Treasury Department to cease its plans to establish a strategic cryptocurrency reserve. The Ranking Member of the House Oversight and Government Reform Committee expressed concerns that the initiative appears more advantageous to Trump and his associates than to the American people.
In a formal letter directed to Treasury Secretary Scott Bessent, Connolly highlighted what he perceives as a significant conflict of interest inherent in the proposal. He contended that the reserve could ultimately serve to enhance Trump's financial interests, thereby undermining economic stability for everyday Americans.
The proposed reserve involves a federal Bitcoin stockpile utilizing approximately 200,000 Bitcoin already held by the government and the creation of a new entity tasked with managing forfeited digital assets, including Ethereum, XRP, Solana, and Cardano. While the Trump administration positions this reserve as a move to fortify American leadership in digital finance, Connolly argues that it could instead create a precarious economic environment, disproportionately benefiting Trump's personal business interests.
Central to Connolly's objections is Trump's financial involvement with the World Liberty Financial Initiative (WLFI), which raises concerns about potential conflicts between governmental policy and Trump's business profitability. Additionally, Connolly criticized Trump's ties to the memecoin Official Trump (TRUMP), labeling it a speculative venture that could profit from volatility—a scenario that could enrich Trump and his allies further.
Connolly also highlighted the lack of congressional authorization for this cryptocurrency reserve, which raises concerns about transparency and accountability. He referenced a Federal Reserve official who had reportedly condemned the initiative as "the dumbest idea" ever proposed.
To escalate his concerns, Connolly requested a detailed briefing on the reserve from the Treasury Department by March 27.
As discussions around governmental involvement in the cryptocurrency sector intensify, lawmakers and financial analysts are deliberating the broader implications of a federally backed digital asset reserve.
This controversy comes amidst significant upheaval in cryptocurrency markets. Following Trump's March 6 executive order, Bitcoin experienced a dramatic drop from over $93,400 to a low of $77,234 in less than a week, although it has since partially recovered to around $83,176.
Meanwhile, the broader cryptocurrency market faced turbulence as altcoins, including Ethereum, XRP, Solana, and Cardano, also saw substantial declines in the wake of the announcement. Investor sentiment remains jittery amid ongoing macroeconomic uncertainties, contributing to the volatility of digital asset trading.
