Rep. Gerald E. Connolly, the ranking of the Huis Oversight and Government Reform Committee, urged the American Treasury Department to give up plans to set up a strategic Bitcoin reserve and the Digital Asset Stockpile.
In a letter to Finance Minister Scott Bessent, Connolly condemned the effort as a tax -irresponsible and political motivated. He warned that the initiative would not serve a clear audience benefit and at the same time pretty much President Donald Trump and his allies.
Trump’s executive order
Connolly’s concerns stem from Trump’s Executive Order of 6 March that establishes the strategic Bitcoin Reserve and US Digital Asset Stockpile, which builds on a broader guideline of 23 January, “Strengthening the American leadership in digital financial technology”.
The initiative would position the federal government as an important holder of Bitcoin (BTC), Ethereum (ETH), XRP, Solana (SOL) and Cardano (ADA). Trump has called the movement a way to strengthen American dominance in digital assets.
Connolly noted that Trump’s sharp change in attitude on crypto, emphasizes that he had previously rejected digital assets as a “scam” during his first term.
However, his administration is now preparing to assign federal funds to the sector – an approach that criticized Connolly as an attempt to manipulate the financial markets for politics and personal gain.
He argued that the move comes down to choosing winners between digital currency and creating artificial demand for assets with which Trump has financial exposure.
Conflicts
The rankings outlined various potential conflicts of interest, including Trump’s reported interest in World Liberty Financial, a digital activist company that wants to act as a crypto-based credit and investment platform.
Connolly warned that the purchases of the government can go directly to the financial possession of Trump, in particular if the administration gives priority to assets that match his private investments.
He also pointed to Trump’s involvement in the $ Trump Memecoin, which has risen in value on the basis of speculation on his political explanations.
He pointed out to reports that entities associated with Trump have generated more than $ 100 million in trading costs of token, which expresses the concern that the crypto initiatives of the administration can further stimulate financial speculations that are linked to the president.
Lack of congress supervision
Connolly also criticized the administration for circumventing the congress in his push to create the reserve, with the argument that Trump had not searched for legislative authorization or had not taken over consultations with legislators about the potential risks or benefits of the reserve.
He warned that the initiative could become a tool for political influence without supervision of the congress instead of a legitimate financial strategy.
He also referred to skepticism of financial experts, with reference to a Federal Reserve officer who reportedly described the plan as “the stupidest idea” ever.
Connolly urged the Ministry of Finance to immediately stop all plans with regard to the strategic crypto reserve. For 27 March he asked for a full briefing for the staff of the Huis Oversight Committee and sought clarity about the legal justification of the reserve.
He also asked for clarity with regard to 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 Ministry of Finance has not yet responded to Connolly’s request. His letter means growing opposition from Congresdemocrats, who are increasingly investigating Trump’s growing involvement in the digital assets industry.
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