Who is Kevin Warsh and what will Trump’s Fed chair pick mean for Bitcoin

President Donald Trump on Friday said he would nominate Kevin Warsh as the next Federal Reserve chair after warring with the current central bank chief to lower interest rates.

Trump’s pick is likely to fulfill the president’s wishes: the former Federal Reserve governor last year said he wanted to lower the cost of borrowing.

“I am pleased to announce that I am nominating Kevin Warsh to be the chairman of the board of governors of the Federal Reserve,” Trump wrote Friday on his social media platform Truth Social.

“On top of everything else, he is ‘central casting,’ and he will never let you down,” the president added.

Warsh’s nomination comes as pro-crypto Trump takes on the Federal Reserve — long expected to be independent from politics — after its current chair Jerome Powell did not lower interest rates as quickly as the top Republican wanted.

Is Warsh pro-crypto?

It would appear that Warsh, a lecturer at the Stanford Graduate School of Business, is pro-crypto. Last year, Warsh, who served as a member of the Federal Reserve Board of Governors from 2006 to 2011, spoke highly of the leading cryptocurrency.

“Bitcoin does not make me nervous…Bitcoin doesn’t trouble me, I think of it as an important asset that can help inform policymakers when they are doing things right and wrong,” he said in an interview.

Warsh showed interest in the big orange coin in a 2018 Wall Street Journal op-ed.

“Its price volatility significantly diminishes its usefulness as a reliable unit of account or an effective means of payment,” he wrote.

“Bitcoin might, however, serve as a sustainable store of value, like gold. Even if you’re not buying cryptoassets, Bitcoin’s boom-and-bust cycle is worth watching.”

The crypto community seems happy with the nomination too. Bitcoin maximalist Michael Saylor, who co-founded Bitcoin treasury Strategy, posted a video on X Friday of Warsh talking Bitcoin.

“Soon, Kevin Warsh will be the first pro-Bitcoin chairman of the Federal Reserve,” wrote Saylor.

Cody Carbone, CEO of blockchain trade association, The Digital Chamber, posted: “The Federal Reserve is a cornerstone institution, and recognition at the highest levels that Bitcoin is an important asset class for US leadership is a significant moment.”

Warsh has also floated the idea of a digital dollar. In 2022, writing in the WSJ, Warsh said that a “new digital dollar would strengthen the currency for a new era, and bolster America as leader of the global economic system” as a way to compete with China’s central bank digital currency.

Warsh did mention the dangers of CBDCs, though, and how China’s digital yuan was “at odds with the American ethos of privacy from government intrusion.”

What’s the Fed got to do with crypto?

Trump has pushed for low-interest rates since taking office last year. Controversially, the 79-year-old has called Powell “stupid” and even threatened to fire him.

While it’s debatable whether or not Trump can fire the central bank leader, the White House has been seen to have found ways to put pressure on the Fed chair.

Earlier this month, the Justice Department opened an investigation into testimony Powell gave to a Senate committee about renovations to Federal Reserve buildings. Powell says the investigation is politically motivated.

Crypto market observers have said that a Federal Reserve chair that does what Trump says — lower interest rates — will help crypto markets. Bitcoin and major digital coins and tokens have typically performed well in a low-interest rate environment.

Mathew Di Salvo is a news correspondent with DL News. Got a tip? Email at mdisalvo@dlnews.com.