Warren Demands No Crypto Bailouts After Trump Firm's Bitcoin Move
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- Elizabeth Warren asked Treasury Secretary Scott Bessent and Fed Chair Jerome Powell to confirm no taxpayer money would be used to bail out crypto investors, citing risks of enriching 'cryptocurrency billionaires'.
- World Liberty Financial, linked to Donald Trump, sold about 173 wrapped Bitcoin to repay $11.75 million in USDC stablecoin debt, avoiding liquidation as bitcoin dropped below $63,000.
- Bitcoin has lost about half its value since its October high, a decline Warren attributed in part to cascading liquidations of leveraged positions.
- Michael Saylor's Strategy Inc., one of the largest corporate Bitcoin holders, has seen its shares fall nearly 20% since the start of the year due to the cryptocurrency's selloff.
- Changpeng Zhao and Brian Armstrong, major crypto investors and leaders of Binance and Coinbase respectively, reportedly lost $30 billion and $7 billion as Bitcoin's value plummeted.
- Scott Bessent, in a February 6 hearing, declined to rule out using taxpayer funds for crypto bailouts, saying the Treasury was 'retaining seized bitcoin,' a response Warren called concerning and unclear.
Why it matters: Warren’s push highlights a direct link between federal crisis powers and high-risk crypto actors: if agencies intervene in a crypto crash, gains would flow disproportionately to leveraged insiders like Trump’s firm and major holders, not taxpayers. The $17.3 billion in stablecoin debt and $47 billion in reported billionaire losses since January show systemic exposure.
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