On December 15, Elizabeth Warren put two names at the top of a letter signaling where she believes U.S. crypto policy is actually written: Treasury Secretary Scott Bessent and Attorney General Pamela Bondi. The question is simple on paper, but complicated in practice. Are her departments investigating what she calls “national security risks” associated with decentralized exchanges, and if so, how far does that scrutiny go if the president’s business operations are part of the story?
The hook she chose is PancakeSwap, a DeFi venue that, as Warren says, sits at the awkward intersection between “no account required” trading and the kind of money that can end up on sanctions chutes. In the letter, she referred to reports that PancakeSwap was used to launder the proceeds of North Korea-related cybercrimes. She then turned the compliance argument into a Washington argument by saying PancakeSwap had “sparked interest” in coins tied to the Trump family’s main crypto company, World Liberty Financial (WLFI), and cited a Wall Street Journal report that claimed over 90% of $1 trades on PancakeSwap occurred.
The cleanest way to read the letter is to ignore the rhetoric and look at the three questions at the end. She called on the Treasury Department and DOJ to describe the national security risks associated with DEXs (including PancakeSwap) and identify gaps in legal and regulatory authority that could be addressed. She also wants lists of measures the authorities will take to prevent conflicts of interest and insulate enforcement and national security decisions from crypto-related conflicts, including explicit “business ties to the Trump family.” She set the response deadline of January 12, 2026.
What Warren asked for and why PancakeSwap got its name
Warren’s choice of target is important because it’s a proxy for a larger argument she’s been making for years: If a service looks and behaves like a financial center, regulators shouldn’t accept “but it’s decentralized” as a pass for violations. Their press release states this clearly, describing DEX activity at scale and arguing that platforms like PancakeSwap and Uniswap can move massive volumes without requiring users to register or show ID.
She also links the pitch to an example of illicit finance, pointing to hackers linked to North Korea and claiming that PancakeSwap was used to facilitate money laundering in connection with a grand theft, with a dollar amount attached. One does not have to accept every implication of this formulation to understand why it is an effective policy. The word PancakeSwap is sticky. It makes a sprawling dispute over DeFi, sanctions and anti-money laundering seem like a single, addressable problem, just as Enron and Lehman Brothers became short names in previous crises.
How a stalled bill could turn Warren’s oversight post into politics
The timing of the letter is the turn of the plot. Congress “is considering legislation on the structure of the crypto market,” writes Warren, and this sentence does a lot of work. In July, the House of Representatives passed a market structure bill that would create a federal framework for crypto and expand the CFTC’s regulatory role, something the industry has wanted for years. However, a vote in the House of Representatives does not result in a resolution in the Senate, and legislation on market structure remains stalled there, even as overall attitudes toward cryptocurrencies have softened in other parts of the government.
That’s why Warren’s “pressure as process” approach is important. When legislation drags on, letters become leverage because they create a balance sheet, force responses, and shape the narrative that lawmakers use to justify a yes vote, a no vote, or a call for carveouts. You can see the continuity if you look back a month. On November 17, Warren and Jack Reed wrote to Bessent and Bondi about World Liberty Financial and its governance token $WLFI.
They cited reports that token sales reached buyers associated with sanctioned or illicit actors and specifically linked this issue to market structure discussions in Congress. The letter devotes pages to the governance aspect, arguing that token ownership can lead to influence. He repeatedly returns to conflicting issues related to the Trump family’s financial interest in the project. Taken together, the November WLFI letter and the December PancakeSwap letter form a two-part argument that is difficult to ignore if you are a senator trying to use the language of “responsible innovation” without seeming naive.
For more information on this topic, you can visit https://cryptoslate.com/pancakeswap-warren-trump-wlfi-crypto-security-risks/
