Senator Elizabeth Warren Urges Fed and Treasury: No Bailouts for Crypto Billionaires
February 18, 2026 — In a strong statement on Wednesday, Senator Elizabeth Warren, the ranking Democrat on the Senate Banking, Housing, and Urban Affairs Committee, called on the U.S. Treasury Department and Federal Reserve to explicitly reject any plans to use taxpayer funds to bail out cryptocurrency billionaires and highly leveraged crypto investors. Her letter was addressed to Treasury Secretary Scott Bessent and Federal Reserve Chair Jerome Powell amid a significant downturn in bitcoin’s value.
Bitcoin, the leading cryptocurrency, has lost roughly 50% of its value since peaking in October 2025. The steep decline has sparked concerns about the stability of the crypto market and has led to widespread liquidations of leveraged positions.
In her letter, Senator Warren warned that any government intervention to stabilize bitcoin or to support cryptocurrency firms would be "deeply unpopular" among taxpayers. She emphasized the disproportionate benefit such a bailout would provide to wealthy crypto investors rather than the broader public.
Warren also drew attention to a potential conflict of interest involving former President Donald Trump. She noted that Trump’s co-founded crypto company, World Liberty Financial, recently sold approximately 173 wrapped Bitcoins to repay $11.75 million in USDC stablecoin debt. This move reportedly helped the company avoid liquidation amid the falling price of bitcoin, which recently dropped below $63,000. The letter highlighted that a bailout could indirectly enrich Trump’s company.
The senator expressed concern about the ambiguity surrounding government plans after Secretary Bessent’s recent testimony before the House Financial Services Committee on February 6. When questioned about whether taxpayer money could be used to support crypto assets, Bessent reportedly did not provide a straightforward denial, instead mentioning that seized bitcoin is being retained.
Warren wrote: "It’s deeply unclear what, if any, plans the U.S. government currently has to intervene in the current Bitcoin selloff." She urged both the Treasury and Fed to refrain from any direct purchases, guarantees, or liquidity facilities that would prop up bitcoin and transfer wealth from taxpayers to crypto billionaires.
She further documented the extent of losses among prominent crypto investors, including:
- Michael Saylor’s Strategy Inc. has seen its shares fall by nearly 20% since the start of the year.
- Binance founder Changpeng Zhao reportedly lost nearly $30 billion.
- Coinbase CEO Brian Armstrong has faced losses estimated at $7 billion.
Beyond market stabilization, Senator Warren called on federal financial regulators to enhance protections for retail cryptocurrency investors. She noted the increasing prevalence of crypto fraud, citing that a record $17 billion was lost or stolen in 2025. The timing of Warren’s letter coincided with World Liberty Financial hosting its inaugural World Liberty Forum for business leaders at Trump’s Mar-a-Lago club in Palm Beach, Florida, underscoring the close ties between influential political and crypto circles.
As of this report, neither the Treasury Department nor the Federal Reserve has issued a public response to Senator Warren’s call for a clear policy against crypto bailouts.
This development adds to ongoing debates about the role of government in addressing volatility and financial risks posed by cryptocurrencies, and the broader question of protecting everyday investors from high-stakes digital asset markets.
— CNBC Politics and Markets News Division