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Kevin Warsh discloses crypto and AI investments ahead of Senate Fed hearing

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Kevin Warsh discloses crypto and AI investments ahead of Senate Fed hearing

Federal Reserve nominee Kevin Warsh disclosed a diverse portfolio of private technology investments, including stakes in artificial intelligence and digital assets, as he prepares for a high-stakes Senate confirmation hearing.

Summary

  • Federal Reserve nominee Kevin Warsh disclosed over $100 million in assets, including stakes in various cryptocurrency and artificial intelligence startups, ahead of his Senate hearing.
  • The Senate Banking Committee scheduled a confirmation hearing for April 21 to vet Warsh as the successor to Jerome Powell, whose second term as chair concludes in mid-May.

According to a filing with the U.S. Office of Government Ethics, the former Fed governor holds interests in crypto-focused firms Compound and Dapper Labs, alongside AI startups such as Factory and Glue. 

While the disclosure values his total assets at more than $100 million, specific valuation ranges for these individual technology holdings were notably absent.

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Reuters reports that federal ethics guidelines exempt officials from reporting the value of assets worth less than $1,000, though the filing did detail substantial positions elsewhere, including over $50 million in the Juggernaut Fund and $10 million in consulting income from Stanley Druckenmiller’s Duquesne Family Office.

President Trump formally submitted Warsh’s name to the Senate in March, following a January announcement that signaled an end to Jerome Powell’s leadership. 

The move comes as the administration faces a ticking clock; Powell’s second term as chair concludes on May 15. 

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The Senate Banking Committee has now scheduled Warsh’s appearance for April 21, positioning him to take over the central bank’s influence over interest rates and broader financial policy just weeks before the vacancy opens.

Despite the movement on the Fed’s leadership, the administration has yet to fill critical vacancies at the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). 

The SEC is currently operating with only three of its five commissioner seats filled, while the CFTC is down to a single commissioner, Michael Selig. 

These gaps persist as a stalled crypto market structure bill remains in the Senate, leaving both agencies shorthanded at a time when they are expected to define the future of digital asset regulation.

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Crypto World

Stablecoins Do Not Threaten Banking Just Yet: Analyst

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Stablecoins Do Not Threaten Banking Just Yet: Analyst

The impact of stablecoins on the banking sector appears “limited” at the current phase of the adoption cycle, but banks could face increasing competition and an erosion of market share as the stablecoin sector and tokenized real-world assets (RWAs) grow in market capitalization. 

“So far, the use of stablecoins remains limited, but their market capitalization exceeded $300 billion at the end of last year,” Abhi Srivastava, associate vice president of Moody’s Investors Service Digital Economy Group, told Cointelegraph.

The stablecoin market cap has surged past $300 billion. Source: RWA.xyz

The role of stablecoins in payments, cross-border commerce and onchain finance is “expanding,” despite their currently limited role, Srivastava said, adding that existing payment systems in the US are already “fast, low-cost and trusted.” He said:

“For the banking sector, at this stage, disruption risk appears limited. In the near term, US rules that prohibit stablecoins from paying yield mean they are unlikely to replace traditional deposits at scale domestically.”

However, over time, growing adoption of stablecoins and tokenized RWAs, traditional or physical financial assets represented on a blockchain by a token, could place “pressure” on the banking sector, leading to deposit outflows and reduced lending capacity, he said.

Stablecoin regulatory policy has become a hot-button issue among crypto industry executives and those in the banking sector, with fears that yield-bearing stablecoins could erode banking market share proving to be a stumbling block for the CLARITY crypto market structure bill in Congress. 

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Related: Stablecoins behave like FX markets as liquidity splits: Eco CEO

CLARITY Act stalled, as banks fight yield-bearing stablecoins

The Digital Asset Market Clarity Act of 2025, also known as the CLARITY Act, is a comprehensive crypto market regulatory framework that establishes an asset taxonomy, regulatory jurisdiction and oversight over the crypto markets.

The CLARITY crypto market structure bill. Source: US Congress

It is now stalled in Congress after a group of crypto industry companies, led by cryptocurrency exchange Coinbase, publicly stated opposition to earlier drafts of the bill.

A lack of legal protections for open-source software developers and a prohibition on yield-bearing stablecoins were among some of the most contentious issues cited by crypto industry opponents of the legislation.

Several attempts have been made by US lawmakers and the White House to negotiate a bill acceptable to both the crypto industry and the bank lobby.

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Earlier this month, North Carolina Senator Thom Tillis said he plans to release an updated draft bill proposal that would be acceptable to both sides; however, the bill has reportedly received pushback, according to Politico, and has yet to be publicly released. 

However, other crypto industry executives and market analysts have warned that if the CLARITY Act fails to pass, it could open the crypto industry up to future regulatory crackdowns by hostile lawmakers and officials.

Magazine: Stablecoins will see explosive growth in 2025 as world embraces asset class