Fed Chair Pick Kevin Warsh Says Crypto Is Already Embedded in Finance, Signals Support Without Backing CBDC

Federal Reserve chair nominee Kevin Warsh told senators digital assets are “already part of the fabric of our financial services industry in the United States”.

Warsh appeared before the Senate Banking Committee as President Trump’s nominee to succeed Jerome Powell, whose term as Fed chair is scheduled to end on May 15.

When Senator Cynthia Lummis asked if Warsh believed digital assets should be incorporated into the American financial system, he responded saying they already are, and they should give investors more opportunities and protections. 

The comments marked a clear pro-crypto tone from a more traditional nominee who previously served on the Fed Board of Governors from 2006 to 2011 and worked at Morgan Stanley.

Read more: North Korea-Linked Hackers Escalate Crypto Attacks With $500M+ Two-Week Haul 

Warsh’s Crypto Support and CBDC Rejection

When asked about a CBDC, Warsh said issuing one would be a “bad policy choice” and reportedly told senators he would not consider issuing one while that decision remained within the Fed chair’s power.

That position aligns with the Trump administration’s broader scepticism toward a US CBDC while preserving room for private digital-asset markets. Warsh framed crypto as a financial-sector reality that regulators should incorporate rather than ignore.

The distinction is important for banks, stablecoin issuers and crypto platforms. So, at least in theory, a Fed chair who supports private digital assets but opposes a CBDC could favour market-led innovation while resisting direct central bank competition with commercial payment systems (keep in mind, banks are not thrilled about stablecoins or anything related to digital assets).

Warsh’s crypto comments came alongside scrutiny of his financial disclosures and independence. Filings released April 14 showed household assets worth more than US$100 million (AU$140 million), including crypto-linked investments across DeFi, blockchain networks, Bitcoin (BTC) infrastructure and Web3 companies.

Senator Elizabeth Warren questioned whether Warsh could act independently and raised concerns about special treatment for politically connected crypto businesses or Wall Street allies. 

Having a sock puppet in charge of the Fed would also give the president access to the Fed’s powerful authorities to enrich himself, his family and his Wall Street buddies. It could mean granting special accounts to his family’s crypto company or bailouts to his friends on Wall Street if they get into trouble.

Senator Elizabeth Warren

Warsh said the president had never asked him to commit to an interest-rate decision and stated he would not agree to do so if asked.