A Democratic lawmaker has urged the US Treasury to “halt all efforts” to establish a strategic cryptocurrency reserve in the United States, citing potential conflicts of interest involving US President Donald Trump and contending that such a reserve would not serve the interests of the American populace.
House Representative Gerald E. Connolly from Michigan criticized the proposed “cryptocurrency reserve” in a letter dated March 13 to Treasury Secretary Scott Bessent, asserting that it offers “no clear benefit to the American people” and would instead disproportionately enrich the president and his benefactors.
Connolly, who did not differentiate between the Strategic Bitcoin Reserve and the Digital Asset Stockpile, remarked that Trump’s initiative would represent “unsound fiscal policy” by selecting specific cryptocurrencies over others via social media platforms.
He further stated that the plan put forth by the Trump administration would squander taxpayer funds on what the Federal Reserve condemned as “the dumbest idea ever.”
“No strategic necessity has emerged that would require investment in the volatile and speculative cryptocurrency market,” Connolly, the leading Democrat on the House committee overseeing government reform, expressed in his letter.
“[It] would amount to nothing more than a highly speculative, taxpayer-funded hedge to reassure bitcoin speculators that when a crash occurs, the State will utilize this fund to bail them out.”
Nevertheless, the White House has indicated that the Digital Asset Stockpile will only include cryptocurrency that has already been forfeited. Simultaneously, the Bitcoin 
BTCUSD reserve will make acquisitions solely through budget neutrality strategies that won’t burden taxpayers.
Connolly also pointed out that Trump did not consult Congress regarding the Bitcoin reserve initiative, let alone secure congressional approval for its creation.
He added that there exist conflicts of interest between Trump’s presidential responsibilities and the Trump Organization’s ownership of the cryptocurrency platform World Liberty Financial, in addition to the Official Trump (TRUMP) memecoin.
The Democrat referred to the TRUMP token as a “money grab” that has enabled Trump-associated entities to profit from over $100 million in trading fees.
This has been described as Trump’s “most profitable get-rich scheme yet,” Connolly noted.
Representative Maxine Waters, a Democrat on the House Financial Services Committee, also criticized Trump’s memecoin on January 20, calling it a rug pull and claiming that the launch exemplified the “worst of crypto.”
Connolly has requested Bessent to provide documents and communications related to the establishment of a Bitcoin reserve and a comprehensive list of actions the Trump administration has undertaken to mitigate conflicts of interest.
Connolly also inquired about the companies in which the Treasury has crypto-related financial stakes. He posed the following question:
“Has the Presidential Working Group on Digital Asset Markets, of which you are a member, tasked with developing a federal regulatory framework to oversee the cryptocurrency reserve, reviewed financial disclosures from Administration officials, including but not limited to Elon Musk?”
The Strategic Bitcoin Reserve will initially utilize cryptocurrencies forfeited in federal criminal or civil proceedings. In contrast, the Digital Asset Stockpile will include cryptocurrencies beyond Bitcoin, potentially encompassing XRP (XRP), Solana (SOL), Cardano (ADA), and Ether (ETH).
