US Treasury Secretary Rules Out Bitcoin Bailouts Amid Market Concerns
By John Nada·Feb 5, 2026·3 min read
US Treasury Secretary Scott Bessent asserts no plans for Bitcoin bailouts during Congressional testimony. The government will retain seized Bitcoin but won't direct banks to buy more.
In a striking exchange during Congressional testimony, US Treasury Secretary Scott Bessent made clear that the government has no plans to bail out Bitcoin (BTC). Bessent emphasized that while the US will retain Bitcoin from asset seizures, it won’t instruct private banks to buy more BTC if the market falters. This statement came in response to California Congressman Brad Sherman, a known critic of cryptocurrencies, who questioned Bessent about the Treasury's authority regarding Bitcoin bailouts.
Bessent was firm, stating, “I am Secretary of the Treasury. I do not have the authority to do that.” This affirmation reinforces the stance that the Treasury Department and the Federal Open Market Committee lack the power to intervene directly in the cryptocurrency market. Bessent also revealed that the $500 million in seized Bitcoin has appreciated to over $15 billion while under government custody.
The testimony additionally touched on the Bitcoin strategic reserve initiative, established by former President Trump through an executive order in March 2025. This initiative has faced criticism from segments of the Bitcoin community, who argue it falls short of what’s needed. The order stipulates that the US can only acquire Bitcoin through asset forfeiture or budget-neutral strategies, effectively ruling out open market operations that many in the crypto space had anticipated.
Budget-neutral strategies involve converting existing reserve assets, like petroleum or precious metals, into Bitcoin without increasing the national budget. This approach indicates a cautious government stance on Bitcoin acquisition, further highlighting the complexities of integrating cryptocurrency into mainstream financial practices.
In August 2025, Bessent had indicated that the Treasury might explore budget-neutral methods for Bitcoin acquisition, which seems to mark a shift from earlier positions. The potential for the US government to actively buy Bitcoin raises concerns about market dynamics and global implications, as Bitcoin advocate Samson Mow pointed out. He noted that government purchasing could signal to other nations the need to establish their own strategic reserves, potentially leading to a competitive race in the crypto arena.
Bessent’s remarks highlight a pivotal moment in the government's relationship with Bitcoin, reinforcing that while the US might hold substantial amounts of Bitcoin, it will not intervene to support the asset during downturns. This stance could impact market sentiment and investor confidence moving forward.
The implications are clear: without government bailouts or active buying, Bitcoin may need to navigate its own market volatility, relying on intrinsic demand without external support. This could shape investor strategies and market perceptions in the months ahead. Ultimately, Bessent's testimony signals a firm governmental boundary regarding cryptocurrency, emphasizing self-reliance within the volatile digital asset space.