Warren Presses Fed and Treasury to Block Crypto Bailouts After $2T Collapse

Elizabeth Warren is pressing U.S. financial regulators to rule out any taxpayer-funded rescue of cryptocurrency billionaires as $2 trillion collapse fuels fears of federal intervention in digital asset markets.

Warren Demands No Bailout for Bitcoin Billionaires

Concerns about potential federal intervention in cryptocurrency markets intensified as U.S. Senator Elizabeth Warren on Feb. 18 urged Treasury Secretary Scott Bessent and Federal Reserve Chair Jerome Powell to confirm that taxpayer funds will not be used to rescue cryptocurrency billionaires during bitcoin’s sharp downturn. Warren stated:

“I write today to request written confirmation that neither the Department of the Treasury (Treasury) nor the Federal Reserve (Fed) will use taxpayer dollars to bail out cryptocurrency billionaires and other highly leveraged cryptocurrency investors.”

In the letter, she pointed to bitcoin’s steep decline, writing that BTC “has lost more than $2 trillion, or about 50%, in value since its October 2025 peak,” and cautioned against federal action that could disproportionately benefit wealthy holders. She emphasized: “Any government response to bitcoin’s recent crash must be centered around bolstering safeguards for individual crypto holders.” The senator also warned: “American taxpayers should not be on the hook for billionaire crypto investors.”

The letter outlines Treasury’s control of the Exchange Stabilization Fund and the Federal Reserve’s 13(3) emergency lending authority, both used in past financial crises, and argues that these mechanisms must not be deployed to stabilize bitcoin prices or assist crypto intermediaries.

Warren further pressed for a formal commitment from regulators, writing: “I therefore seek written confirmation from you that the U.S. Treasury and the Federal Reserve will not use their authorities … to bail out the bitcoin market or crypto asset intermediaries no later than February 27, 2026.”

She cited concentrated ownership within the bitcoin ecosystem and rising fraud losses as reasons to prioritize consumer safeguards over market intervention. The senator highlighted that billions of dollars were lost to crypto scams last year, including significant sums tied to impersonation schemes and bitcoin ATM fraud. Warren stressed that strengthening oversight, enhancing investor protections, and preventing taxpayer exposure to speculative market losses should guide any federal response to ongoing volatility in digital asset markets.

FAQ ⏰

• Why did Elizabeth Warren warn against a bitcoin bailout?

She urged regulators to confirm taxpayer funds will not be used to rescue cryptocurrency billionaires after crypto’s $2 trillion decline.

• How much value has bitcoin lost since its October 2025 peak?

Warren said bitcoin has lost more than $2 trillion, or about 50%, since its October 2025 high.

• What federal tools did Warren reference in her letter?

She cited the Treasury’s Exchange Stabilization Fund and the Federal Reserve’s 13(3) emergency lending authority.

• What risks did Warren highlight in the crypto market?

She pointed to concentrated ownership and billions of dollars in crypto scams, including bitcoin ATM fraud.