What You Need to Know About Kevin Warsh if Selected as New Fed Chair As of January 2026, former Federal Reserve Governor Kevin Warsh has emerged as a leading contender for Federal Reserve Chair, with betting markets in mid-January showing his odds surging to around 60%. Here is a breakdown of the potential impact on the crypto industry if Warsh becomes Fed chair: 1. Regulatory Stance: Stricter Rules for Private Crypto Warsh has expressed significant skepticism about private, decentralized cryptocurrencies, often referring to them as "software" rather than money. Stablecoin Regulation: He is expected to push for stricter regulation of stablecoin issuers, potentially classifying them as "narrow banks" requiring 100% cash or short-term debt reserves. This could eliminate smaller, under-collateralized stablecoins but provide clearer legal status for large, regulated players. Reduced "Shadow Banking": He has criticized crypto activity in the "shadow banking" sector and would likely prefer bringing compliant crypto businesses under mainstream banking oversight. 2. CBDC and Blockchain: Pro-Wholesale Digital Dollar Warsh's stance is nuanced: Opposed to Retail CBDC: He has concerns that a retail CBDC (accessible to individuals) could enable government surveillance and erode privacy. Pro-Wholesale CBDC: He advocates for a wholesale CBDC used only for interbank and central bank transactions to modernize payments and maintain dollar dominance. 3. Monetary Policy and Market Impact As a "hawk" prioritizing inflation control, his policies could have mixed effects on crypto liquidity. Tightened Liquidity (Short-term Pressure): Known for aggressive quantitative tightening, a conservative approach could pressure risk assets like Bitcoin short-term. Long-term Stability: His focus on sustainable monetary policy could foster less volatile, more enduring market growth. 4. Integration with Traditional Finance Bank-Crypto Partnerships: Warsh argues isolation of crypto increases risks and may support banks offering custody and payment services for digital assets under strict risk management. Institutional Adoption: A regulated framework could encourage greater institutional investment in cryptocurrencies. Summary of Potential Impact: A Warsh-led Fed likely ends the "Wild West" era for US crypto regulation. While bringing stricter compliance and short-term liquidity pressures, it could enable more stable integration of blockchain and regulated digital assets into traditional banking. #NewFedChairman #CryptoMarkets