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Treasury Draws Firm Line as Bitcoin Reserve Debate Roils Capitol Hill

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The U.S. Treasury faced sharp questions Tuesday over Bitcoin policy during a tense Capitol Hill hearing. Lawmakers focused on whether the government should purchase Bitcoin or allow federal assets to back crypto. Treasury Secretary Scott Bessent firmly stated that taxpayer funds would not be used to buy or support digital currencies.

Treasury Blocks Bitcoin Intervention Despite Pressure

During a House Financial Services Committee hearing, Rep. Brad Sherman pressed Bessent about potential Bitcoin-related bailouts. Sherman suggested the Treasury could direct banks to hold Bitcoin or tweak reserve policies to support crypto. However, Bessent responded that the law gives him no such authority, and he cannot compel banks to make crypto purchases.

Bessent further clarified that taxpayer funds cannot be invested in digital currencies or in any tokens, including Solana-based meme assets. He emphasized that his role under current regulations does not permit using federal funds for Bitcoin exposure. Sherman countered by raising concerns over private banking funds, but Bessent maintained that those are not public monies.

The exchange intensified when Sherman questioned if the government would ever use tax revenue to accumulate Bitcoin reserves. Bessent reiterated that only seized Bitcoin is held by the U.S. government under existing forfeiture processes. He cited prior seizures totaling $1 billion, with $500 million retained and now worth over $15 billion.

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TRUMP Coin Draws Fire During Crypto Oversight Talks

Rep. Sherman also referenced the “TRUMP” meme coin issued on the Solana blockchain, linking it to speculation and volatility. He asked if such coins could ever qualify for government-backed purchases or policy inclusion. Bessent replied that neither the Treasury nor the FSOC has the authority to act on speculative meme coins.

While Bessent stayed neutral on the TRUMP coin, Sherman emphasized its unregulated nature and alleged political branding. He warned that using public resources for these assets could set a dangerous precedent. The discussion signaled growing discomfort among lawmakers about crypto products perceived to be linked to public figures.

Bessent declined to provide specific commentary on TRUMP coin but reinforced that the Treasury does not engage in speculative crypto activities. He stood by the department’s position that taxpayer dollars should not enter volatile or unregulated digital markets. This stance continues to define Treasury policy amid rising political attention on meme coins.

World Liberty Financial Raises Scrutiny Over Security Risks

Rep. Gregory Meeks shifted focus to World Liberty Financial, citing concerns about foreign ties and investor transparency. He referenced statements from founder Eric Trump, who claimed he had undisclosed yet “meaningful” investors. Meeks argued that such ambiguity could pose national security risks, especially if linked to foreign capital.

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The lawmaker also pointed out that the WLFI token had lost over 50% of its value, adding to concerns of instability. He said discussion forums revealed unease about governance, suggesting that the Trump family controlled key decisions. Meeks argued this ownership structure could allow selective profit-taking from token sales.

Senator Elizabeth Warren had previously called for an investigation into a deal involving a UAE royal entity and World Liberty Financial. Meeks followed up by urging tighter oversight of any bank license applications tied to the firm. However, Bessent refused to intervene, stating that the Office of the Comptroller of the Currency operates independently.

Risk & affiliate notice: Crypto assets are volatile and capital is at risk. This article may contain affiliate links. Read full disclosure

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Bitcoin ETF inflows hit highest level since February

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ProShares introduces first CoinDesk 20 Crypto ETF under ticker KRYP

Bitcoin traded around $68,780 on Tuesday as U.S. spot bitcoin ETFs posted their strongest daily inflow in more than a month.

Funds added a combined $471 million on April 6, according to SoSoValue data, marking the largest inflow since Feb. 25 and the sixth-biggest daily total this year. The figure remains below January’s peak flow regime, when multiple trading days topped $700 million.

These high inflows come as bitcoin continues to stall below $70,000, with weak spot demand and distribution by large holders capping upside. ETFs have increasingly offset that pressure, acting as a primary source of marginal buying.

Macro signals offer limited direction. Markets are pricing a 98% probability that the Federal Reserve will hold rates steady at its April meeting, according to Polymarket data, with minimal expectations for near-term cuts or hikes.

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Bitcoin’s relationship with global monetary policy may be shifting, with ETFs changing not just the scale of demand but its timing.

A recent Binance Research report finds bitcoin’s correlation with its Global Easing Breadth Index, which tracks 41 central banks, has turned sharply negative since 2024, the same year U.S. spot ETFs were approved. Before then, bitcoin tended to follow easing cycles with a lag. That relationship has now flipped, with the inverse effect nearly three times stronger.

The shift reflects who sets the marginal price. Retail once reacted to macro after the fact. ETF-driven institutional flows are more forward-looking, positioning ahead of expected policy moves.

“BTC may have evolved from a macro ‘lagging receiver’ to a ‘leading pricer,’” Binance Research wrote.

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ETF inflows continue to absorb supply and anchor prices, which could explain the continued daily inflow.

If what Binance Research proposes holds, bitcoin may keep trading as a forward-looking asset, pricing in central bank pivots before traditional markets rather than reacting to them after the fact.

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US Bankruptcy Filings Spike 14% in Q1 2026: What’s Driving the Surge

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Total US bankruptcy filings climbed 14% in the first quarter of 2026, reaching 150,009 cases between January and March, up from 132,094 during the same period last year.

The increase spans consumer and commercial categories alike, according to data from Epiq AACER published by the American Bankruptcy Institute (ABI).

US Bankruptcy Filings Surge As Inflation Takes Its Toll

Small business filings showed the most dramatic acceleration. Subchapter V elections surged 67% to 833 from 499 a year earlier. Commercial Chapter 11 filings also rose 37%, climbing from 1,764 to 2,422.

Consumer filings told a similar story. Individual Chapter 7 cases increased 17% to 89,259. Chapter 13 filings rose 8% to 51,962. Total consumer filings reached 141,573. But what’s behind the rise? 

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“Persistent inflation, high interest rates, restricted credit, and global instability continue to compound the economic challenges of struggling families and small businesses,” ABI Executive Director Amy Quackenboss stated.

The Federal Reserve Bank of New York’s latest report on household finances underlines the pressure. Household debt hit $18.8 trillion by the end of Q4 2025. Credit card balances reached $1.28 trillion, with notable deterioration in mortgage and student loan arrears as well.

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Legislative Response and Outlook

Congress is weighing measures to ease access to bankruptcy protection. Legislation introduced recently by Senator Chuck Grassley in the Senate and Representative Ben Cline would permanently raise the small business reorganization threshold for Chapter 11 to $7.5 million. It would also lift the Chapter 13 debt ceiling to $2.75 million.

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However, relief may not come quickly. The IMF has projected that US inflation will not return to the Fed’s 2% target until early 2027, suggesting elevated borrowing costs will persist well into next year.

Meanwhile, the US national debt recently surpassed $39 trillion, adding further strain to an already stretched fiscal environment. Whether legislative action can keep pace with growing financial distress remains an open question heading into Q2.

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The post US Bankruptcy Filings Spike 14% in Q1 2026: What’s Driving the Surge appeared first on BeInCrypto.

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XRP slips to $1.31 after failed breakout as liquidity dries up

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XRP slips to $1.31 after failed breakout as liquidity dries up


Rejection at $1.35 and collapsing depth raise risk of sharper moves as positioning builds.

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Indonesian Authorities Used Crypto Data to Convict Criminals

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Indonesian Authorities Used Crypto Data to Convict Criminals

Onchain evidence was key to securing the conviction of three individuals for terrorism financing in Indonesia in 2024 and 2025, reflecting a clear shift in the way courts value onchain evidence.

“Indonesian courts have demonstrated that cryptocurrency evidence — wallet addresses, transaction histories, on-chain flows — is not only admissible but can anchor a terrorism financing prosecution,” TRM said in a statement Sunday.

TRM said terrorism financing networks have preferred cryptocurrency as a mechanism of choice to move money, as authorities and regulators have been slow to treat it with the same level of scrutiny as traditional fiat channels, but noted that this is now changing. 

Indonesian authorities traced one defendant sending more than $49,000 worth of USDt (USDT) across 15 transactions from a local exchange to a foreign platform, with the funds later routed to an ISIS-linked terrorism fundraising campaign in Syria, according to the blockchain firm. 

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Indonesia’s financial intelligence team and its counterterrorism police unit, Densus 88, carried out the analysis and presented the findings to Indonesian courts, which accepted the blockchain data as key evidence in each of the three cases.

Source: TRM Labs

Indonesia is not the only country in Southeast Asia using blockchain analytics to catch criminals, TRM said.

“Similar patterns are emerging across Southeast Asia, where governments are investing in blockchain intelligence capabilities and enhancing collaboration between public and private sectors to address illicit finance risks.”

TRM Labs said that Singapore and Malaysia’s financial intelligence units and law enforcement agencies are also building the technical capacity to trace cryptocurrency flows.

Related: Drift Protocol says $280M exploit took ‘months of deliberate preparation’ 

On April 1, Cambodian and Chinese officials captured Li Xiong, a leader of the Huione Group, an organization that served scam centers in Cambodia that carried out “pig butchering” frauds and other investment schemes to steal crypto from victims around the world. 

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Xiong was extradited to China, where he is set to face fraud and money-laundering charges. 

His extradition came three months after the arrest of Chen Zhi, the head of Prince Group, which operates Huione Group.

TRM reported in February that illicit entities received about $141 billion worth of stablecoins in 2025, marking a five-year high.

Magazine: Are DeFi devs liable for the illegal activity of others on their platforms?

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