Even though Kevin Warsh is known to strongly support cryptocurrency, his likely appointment as the new Federal Reserve Chair could cause some temporary difficulties for Bitcoin.
Historically, the cryptocurrency market has often experienced significant drops in value shortly after a new leader takes over at the Federal Reserve.
Current macroeconomic conditions indicate that history might repeat itself this time around.
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The “Fed chair curse”
Since 2014, the price of Bitcoin has tended to drop sharply whenever a new chair takes over at the Federal Reserve.
When Janet Yellen became the head of the Federal Reserve, the price of Bitcoin dropped dramatically, falling by 86%.
When Jerome Powell officially became Fed Chair in 2018, the cryptocurrency plunged by 74%.
At the start of Powell’s second term in 2022, Bitcoin experienced another severe drop of 60%.
Bitcoin is currently trading around $77,367, and upcoming changes in leadership could be causing some concern among those involved in the crypto market.
High Rates and Warsh’s Pro-Bitcoin paradox
Many believe Warsh is the most supportive candidate for cryptocurrency ever nominated to the Federal Reserve. He’s openly complimented Bitcoin, calling it a significant asset and a useful signal for how monetary policy is working.
Even though he supports digital assets, broader economic challenges could still cause them problems right away.
Warsh is entering a challenging situation for investments. He’s taking the reins of an economy with interest rates at 3.5%, and only one rate cut is expected before 2026.
Jerome Powell’s term as the head of the U.S. central bank will officially conclude on May 15.
Jerome Powell has just finished his last meeting as head of the Federal Reserve. During the meeting, the committee decided to keep interest rates unchanged, marking their most split decision in over three decades.
The bottom line is that Bitcoin could face a turbulent few months.
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2026-04-30 21:36