Rep. Gerald E. Connolly, the Rating Member of the Home Oversight and Authorities Reform Committee, urged the US Treasury Division to desert plans to ascertain a strategic Bitcoin reserve and the digital asset stockpile.
In a letter to Treasury Secretary Scott Bessent, Connolly condemned the trouble as fiscally irresponsible and politically motivated. He warned that the initiative would serve no clear public profit whereas considerably enriching President Donald Trump and his allies.
Trump’s govt order
Connolly’s considerations stem from Trump’s March 6 govt order establishing the Strategic Bitcoin Reserve and US Digital Asset Stockpile, which builds on a broader January 23 directive, “Strengthening American Management in Digital Monetary Expertise.”
The initiative would place the federal authorities as a significant holder of Bitcoin (BTC), Ethereum (ETH), XRP, Solana (SOL), and Cardano (ADA). Trump has referred to as the transfer a solution to cement US dominance in digital property.
Connolly famous Trump’s sharp change in stance on crypto, highlighting that he had beforehand dismissed digital property as a “rip-off” throughout his first time period.
Nevertheless, his administration is now getting ready to allocate federal funds to the sector — an strategy Connolly criticized as an try to control monetary markets for political and private acquire.
He argued that the transfer quantities to choosing winners amongst digital currencies and creating synthetic demand for property that Trump has monetary publicity to.
Conflicts of Curiosity
The Rating Member outlined a number of potential conflicts of curiosity, together with Trump’s reported stake in World Liberty Monetary, a digital asset agency that goals to perform as a crypto-based lending and funding platform.
Connolly warned that authorities purchases of crypto might immediately profit Trump’s monetary holdings, notably if the administration prioritizes property that align together with his personal investments.
He additionally pointed to Trump’s involvement within the $TRUMP memecoin, which has surged in worth based mostly on hypothesis surrounding his political statements.
He pointed to stories that entities linked to Trump have generated over $100 million in buying and selling charges from the token, elevating considerations that the administration’s crypto initiatives might additional drive monetary hypothesis tied to the president.
Lack of Congressional oversight
Connolly additionally criticized the administration for bypassing Congress in its push to create the reserve, arguing that Trump had not sought legislative authorization nor engaged in session with lawmakers concerning the reserve’s potential dangers or advantages.
He warned that with out congressional oversight, the initiative might grow to be a instrument for political affect fairly than a legit monetary technique.
He additionally referenced skepticism from monetary consultants, citing a Federal Reserve official who reportedly described the plan as “the dumbest thought” ever.
Connolly urged the Treasury Division to instantly halt all plans associated to the strategic crypto reserve. He requested a full briefing for Home Oversight Committee employees by March 27 and sought readability on the reserve’s authorized justification.
He additionally requested readability concerning the method for buying and managing the property, the potential impression on crypto markets, and any monetary ties between the White Home and digital asset corporations.
The Treasury Division has not but responded to Connolly’s request. His letter alerts rising opposition from congressional Democrats, who’re more and more scrutinizing Trump’s increasing involvement within the digital asset business.
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